Japan has fallen victim to the Keynesian scam

oh, that goes perfectly in line with someone who seemed to know his shit about fixed income trading and valuation, to someone who then slid down the rope to claim "Abenomics" is on track to pull Japan out of the mud, to become the one declaring Kyle Bass an amateur on Japan (Kyle being possibly one of the most informed and knowledgeable people on anything regarding economics in Japan), to finally claim BoJ balance sheets can be netted off with the one of the Japanese government so that you can maintain your ridiculous number twisting exercise. Indeed that intellect of yours went all the way down that slippery slope with you.

And by the way, stop twisting my words. a) I declared you a fool on Japan matters because you demonstrated it to everyone in public by wanting to net off BoJ and Japanese government balance sheets, else I actually still hold up my respect to your knowledge in the fixed income arena, b) I never called you an idiot even once, I said you either love to steer up debate by putting up the garbage you did or you are an idiot, the choice is entirely yours. At the very least you lost most likely not just my respect in your ability to intelligently debate economics. I am sure you can live with that. After all ET is not a big part of your life, you are trailing a lot of more committed individuals with your "only" 6590 posts ;-)

Martinghoul said:
Awwwww, how quickly you have gone from "hard-earned reputation" and "expert" (even if I was just pretending to be one) to "fool", "moron" and "idiot"... What a fall from grace it's been for me!
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volpunter said:
oh, that goes perfectly in line with someone who seemed to know his shit about fixed income trading and valuation, to someone who then slid down the rope to claim "Abenomics" is on track to pull Japan out of the mud, to become the one declaring Kyle Bass an amateur on Japan (Kyle being possibly one of the most informed and knowledgeable people on anything regarding economics in Japan), to finally claim BoJ balance sheets can be netted off with the one of the Japanese government so that you can maintain your ridiculous number twisting exercise. Indeed that intellect of yours went all the way down that slippery slope with you.

And by the way, stop twisting my words. a) I declared you a fool on Japan matters because you demonstrated it to everyone in public by wanting to net off BoJ and Japanese government balance sheets, else I actually still hold up my respect to your knowledge in the fixed income arena, b) I never called you an idiot even once, I said you either love to steer up debate by putting up the garbage you did or you are an idiot, the choice is entirely yours. At the very least you lost most likely not just my respect in your ability to intelligently debate economics. I am sure you can live with that. After all ET is not a big part of your life, you are trailing a lot of more committed individuals with your "only" 6590 posts ;-)
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Haha, Kyle Bass, one of the most informed and knowledgeable people on anything regarding economics in Japan? I guess that must be why he is on record predicting a monster JGB selloff within 18-24 months in 2009? At the time he made this "prophecy", 10y JGBs were yielding 1.3%. Today, they yield around 50 basis points. Last time I saw the performance of his dedicated "short Japan" fund mentioned (a couple of years ago), it was down 61% from inception. Yeah, that Kyle Bass sure sounds like a real "expert" on Japan! Quick, I wanna give him some of my money to manage!

I can live with the loss of respect and all those other terrible things. It sure beats being naive...
 
that is another false claim of yours. He has been talking about the JGB market since 2009, accurate. If you look at his fund's performance it can hardly be said that he has entered any serious position so far. Kyle Bass never proclaimed that at any time since 2009 was the ideal point in time to massively sell JGBs and b) if you ever actually read carefully what Kyle Bass was saying you would concur that he intended and still intends to put on a position by spreading mainland Chinese firms against certain companies in Japan. He never said that the optimal trade of his idea was to sell JGBs. But you would not know that because you seem to enjoy listening to your talk all day instead of actually reading carefully what those that have a long and highly profitable track record have to say. Your stated performance is inaccurate. But I get why you say that, because you seem to get all wound up with unconfirmed reports how he lost 29% or so in April 2012 which turned out to be an utterly false and later confirmed rumor. And that is the very same website you pulled your 61% out of your arse. Of course unconfirmed, lol.

And here are confirmed numbers: His 9-month to Sept.30 2012 performance has been around +10%. If that Japan trade was at all significant and indeed lost as much as you claimed he would not have achieved such results. By the way, that period has been tricky for most all hedge funds. The top performing fund generated around 37% returns. Source: http://www.bloomberg.com/news/2013-01-03/the-100-top-performing-large-hedge-funds.html (again, "Bloomberg Rankings" is one of the most credible sources, at least exponentially more credible than your dirty web search). And he cannot be that bad if he generated (2006 20.6%, 2007 216.6%, 2008 6.1% (most every hedge fund lost money big time in 2008), 2009 9%). What do you, Martin, have to show for your big talk and 6590 posts?

Martinghoul said:
Haha, Kyle Bass, one of the most informed and knowledgeable people on anything regarding economics in Japan? I guess that must be why he is on record predicting a monster JGB selloff within 18-24 months in 2009? At the time he made this "prophecy", 10y JGBs were yielding 1.3%. Today, they yield around 50 basis points. Last time I saw the performance of his dedicated "short Japan" fund mentioned (a couple of years ago), it was down 61% from inception. Yeah, that Kyle Bass sure sounds like a real "expert" on Japan! Quick, I wanna give him some of my money to manage!

I can live with the loss of respect and all those other terrible things. It sure beats being naive...
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volpunter said:
that is another false claim of yours. He has been talking about the JGB market since 2009, accurate. If you look at his fund's performance it can hardly be said that he has entered any serious position so far. Kyle Bass never proclaimed that at any time since 2009 was the ideal point in time to massively sell JGBs and b) if you ever actually read carefully what Kyle Bass was saying you would concur that he intended and still intends to put on a position by spreading mainland Chinese firms against certain companies in Japan. He never said that the optimal trade of his idea was to sell JGBs. But you would not know that because you seem to enjoy listening to your talk all day instead of actually reading carefully what those that have a long and highly profitable track record have to say. Your stated performance is inaccurate. But I get why you say that, because you seem to get all wound up with unconfirmed reports how he lost 29% or so in April 2012 which turned out to be an utterly false and later confirmed rumor. And that is the very same website you pulled your 61% out of your arse. Of course unconfirmed, lol.

And here are confirmed numbers: His 9-month to Sept.30 2012 performance has been around +10%. If that Japan trade was at all significant and indeed lost as much as you claimed he would not have achieved such results. By the way, that period has been tricky for most all hedge funds. The top performing fund generated around 37% returns. Source: http://www.bloomberg.com/news/2013-01-03/the-100-top-performing-large-hedge-funds.html (again, "Bloomberg Rankings" is one of the most credible sources, at least exponentially more credible than your dirty web search). And he cannot be that bad if he generated (2006 20.6%, 2007 216.6%, 2008 6.1% (most every hedge fund lost money big time in 2008), 2009 9%). What do you, Martin, have to show for your big talk and 6590 posts?
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I will quote, again, his October 2009 letter (you can find it on the web):
"...we believe OECD rates will begin their ascent within the next 18 - 24 months and that the best convexity for rates is in Japan."

There are also other passages there that suggest that Kyle Bass bet on higher Japanese rates and weaker yen, all within a two year period from when the letter has been written. Needless to say, this prediction was monumentally wrong in terms of timing. It was, at best, half-right in terms of substance, as weaker yen did eventually materialise.

As to Kyle Bass's returns, you seem to have a reading problem. I said nothing whatsoever about the returns he has generated in his main fund, which uses all sorts of strategies (e.g. mortgages, etc). For all I know, he's a great credit/distressed investor and I have no reason to believe otherwise. My point solely and specifically was about his dedicated, standalone Japan macro fund (Hayman Japan Macro Opportunities, I believe, it's called, and it is, in fact, pretty small, arnd $100mil or so). This dedicated fund, if we believe what Kyle Bass has written in his letters, was a large bet on higher Japan rates/weaker yen. If you have any evidence that suggests that the performance figure I have seen and quoted here is wrong, please don't hesitate to point me to it.

At any rate, let's just finally agree to disagree and move on, shall we?
 
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What is wrong with betting a manageable amount of money on a good call that went sour? (your stated 61% figure was pure speculation and sources have never confirmed that). That makes him less of an expert on Japan? How many of the smartest hedge fund traders bet on rising sovereign bond yields this year and got stopped out? So they are all idiots because they got that call wrong? Kyle Bass is by wide agreement one of the foremost experts on the Japanese economy among hedge fund traders. You can continue to study some ivory tower magazines but I put my confidence on research performed by someone with a long enough profitable track record and someone who is widely respected in anything he opens his mouth about. Kyle Bass performed and published research that is hard to impossible to refute its quality of while you cannot even get your shix together about the differences between the Japanese government vs. BoJ balance sheets.

Oh yes, you can bet on me disagreeing with your ridiculous claim that government debt = household debt, BoJ balance sheet = government balance sheet, and other amusing and highly entertaining lapses.



Martinghoul said:
I will quote, again, his October 2009 letter (you can find it on the web):
"...we believe OECD rates will begin their ascent within the next 18 - 24 months and that the best convexity for rates is in Japan."

There are also other passages there that suggest that Kyle Bass bet on higher Japanese rates and weaker yen, all within a two year period from when the letter has been written. Needless to say, this prediction was monumentally wrong in terms of timing. It was, at best, half-right in terms of substance, as weaker yen did eventually materialise.

As to Kyle Bass's returns, you seem to have a reading problem. I said nothing whatsoever about the returns he has generated in his main fund, which uses all sorts of strategies (e.g. mortgages, etc). For all I know, he's a great credit/distressed investor and I have no reason to believe otherwise. My point solely and specifically was about his dedicated, standalone Japan macro fund (Hayman Japan Macro Opportunities, I believe, it's called, and it is, in fact, pretty small, arnd $100mil or so). This dedicated fund, if we believe what Kyle Bass has written in his letters, was a large bet on higher Japan rates/weaker yen. If you have any evidence that suggests that the performance figure I have seen and quoted here is wrong, please don't hesitate to point me to it.

At any rate, let's just finally agree to disagree and move on, shall we?
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So much to the fact that there are other forces at play than just some funny bloggers that insist central bank balance sheets can be netted off with government balance sheets and that government debt is anyway the same as household debt. Next thing Martinghoul probably insists on is that sliding confidence in Japan by foreign investors does not matter because most debt is held domestically.

Moody’s downgrades Japan’s credit rating
Agency cites ‘heightened uncertainty’ over deficit reduction goals
 
Martinghoul said:
I thought bankruptcies were part of capitalism. You know all that creative destruction stuff?

In general, I am really not into this cherry-picking of data and charts. I could offer you a few of my own, but it's difficult to draw conclusions.
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Feel free to offer what you would like.

Each post I offer something different so that collectively, they can show a pattern. You are most welcome to show us all the positive data coming out of Japan. I can't wait for the volumes of data.
 
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