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Japan Downgrades Its Economy

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http://www.telegraph.co.uk/finance/globalbusiness/8447209/Japan-downgrades-its-economy.html

The move, the first by Naoto Kan's ruling party in six months, accompanied a warning that key areas, including industrial production and exports, would struggle in the near future.

On Monday the IMF cut its forecast for Japanese growth, while the Bank of Japan slashed its assessment of the economy last week, saying it would remain under "strong downward pressure" for some time.

"The economy is showing weakness due to the influence of the Great East Japan Earthquake," the government said in its monthly economic report for April.

Japan is still reeling from the March 11 disaster, which has left 28,000 people dead or missing. Further tremors have been felt this week and the severity of the nuclear crisis at the Fukushima Dai-ichi plant has been raised to the same level as Chernobyl.

The damage to the power plant has led to rolling blackouts, affecting production at major companies. The government warned of downside risks to the outlook that could stem from such power supply constraints, as well as slow progress in restoring supply chains and the impact of rising oil prices.

I wonder how long Japan will have rolling blackouts for, could this tsunami be the disaster that tips Japan into it's debt death spiral?

I'm sure this is all priced into the markets.

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http://www.telegraph.co.uk/finance/globalbusiness/8447209/Japan-downgrades-its-economy.html

I wonder how long Japan will have rolling blackouts for, could this tsunami be the disaster that tips Japan into it's debt death spiral?

I'm sure this is all priced into the markets.

No, no, you've got it all wrong. There will be a massive 'Keynesian' stimulus from the rebuilding work which will turbo charge Japan's economy and yank it out of the precarious position it is in!!! :lol:

In fact, it's such a boon that I don't see why we can't just nominate a few towns/cities of our own ... evacuate the people ... bomb the infrastructure into oblivion and then enjoy the economic boost from rebuilding it (and replacing all the ordnance) which will surely flow from that. Nope, can't see the flaw in that logic at all.

IMO Japan is screwed. Their demographics point to a shrinking GDP no matter what, they are up to their necks in massive debt already as a result of keeping their banking system afloat for the last decade after their property bubble burst and they have just lost a massive chunk of productive capacity with continued impairments due to rolling power cuts and an ongoing nuclear disaster. They are now supposed to borrow massive amounts more cash just to get themselves back to where they were a little over a month ago and this is going to make for a net improvement in their position? Uh-huh ... pull the other one.

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Japanese bonds are underpinned by the success of the japanese government brainwashing it's people into buying them. The japanese people own 95% of government bond. This is a disaster waiting to happen although one must remember that culturaly the japanese are very different from us and not prone to making rash decisions so bonds will not crash until they absolutely have to (but then they will crash big time).

Japanese stocks are pretty cheap in yen but not in sterling so not really worth buying unless you have yen. The alternative is to go long the NIKKI 225 via spread betting. Japanese stocks have limited downside and possible large upside.

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Japan will be rebuilt

in about 20 years, by the Chinese. China will correct the Japanese demographic problem using the model they employed in Tibet - ship in millions of Chinese people.

Havent a lot of Chinese people been going to Japan for a long time?

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Havent a lot of Chinese people been going to Japan for a long time?

No, not really, loads of Koreans though.

I guess Kan just wants the Yen to fall. Before the earthquake it was at about 134 (to the Gbp) then it went to 123, then to 139 and now back to 135. Recovering from stuff is what Japan does!

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  • 312 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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