nikkei poll

Quote from BlueHorseshoe:



If the Yen breaks down big time, say to 200=250JPY/USD, what impact on the Nikkei? I'm sure there are precedents in ... Thailand, S. America, just not up on global economics. Any thoughts?

Without doing any research, my guess is that the Nikkei must follow the currency down initially but afterward domestic production costs decline, exports rise, thus profits and Nikkei rise? Also, inflation returns which is good for asset values and earnings improvement?

Have to agree on the bear yen. Should have been devalued years ago back when the world's largest economy could weather a deval of the currency of #2 economy. Now both economies are in the toilet. Still recall the Reagan/Bush administrations harrassing the Japanese to open up trade barriers and undertake structural reform - apparently nobody was listening ...

It seems now Japanese are attempting to address structural problems in earnest - Thursday WSJ had some good related articles. Debate seems to be centered on whether it is too little too late.

Interested in further reasoned opinions on Yen/Nikkei ...
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Nobody can predict future especially in the market, known fact.
However, there is one fact we rarely and definitely can predict in Japan. Which is it is going to be a aging society, rapidly.
I see a currency is not going to be strong in such a country.
So, Yen is bear in super long trend, IMO.
 
Bluehorseshoe
calls like 250 for the yen are very far out of my personal horizon. I think you are right with the Nikkei. But I think it is by far away from reality to compare the US economy and the Japanese - no matter how bearish one can be on the US market as such.


peace
 
Quote from man:

Bluehorseshoe
calls like 250 for the yen are very far out of my personal horizon.

peace
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I agree. The Japanese ministry doesn't want a 250 usd/jpy, it would cause an asian front war for crissakes! Can you imagine how China or Hong Kong would deal with this kind of cost explosion of doing business in Japan? CHina and other neighbors have already voiced displeasure with Japan's manipulative Forex policies. As a resident of Japan who makes regular forex transactions, I can tell you that a USD/JPY over 130 hurts pretty bad for exporters, a 200 USD/JPY would be on par with a financial meltdown. In fact, not many people hae notcied that the newly appointed MOF govenor has changed the weak yen policy to one of stabilize the yen, there is no need to work against the tide in the Forex market, no government, even the cash soaked Japanese, can hold back the dollar bears, they are on ALL fronts, not just on the JPY bulls.

From a technical standpoint, Forex intervention has been an inveitable warning bell of huge counter moves to the governments intentions. Look at GBP, the DMK, even the formerly dollar locked THB. Deep pocketed speculators have made their fortunes on holding contra positions to the historically myopic finance ministers of these countries.

I don't suspect this will be any different no matter how much rhetoric the MOF spins with their "get tougher" stance on reckless speculators buying yen without actually "investing" the funds in the Japanese infrastructure.

And one more thing, no matter how hard MOF tries to devalue the yen, the market is two steps ahead "devaluing" the dollar every quarter for the past two years. Look at the DX future, IT is doomed. Its a race to the bottom, and I think the USD has a stronger downtrend than the Nikkei, its a baby trend, the NIkkei trend is getting old and weary, sub 7k will be a great buy op, but I don't trade the Nikkei, why bother? It is easily the most overtly manipulated low volume index in the world. It screams, "stay away from me, I am a pathetic arm of our withering MOF."

So that's how I see it.
 
I agree with most of what you said. A yen below 150 will force china to do something. and china's shere size is sooner or later finally becoming the dominant factor in asia (IMO).

nevertheless the Nikkei is a tradeable asset. Not at least b e c a u s e of interventions.


peace
 
Quote from man:

I agree with most of what you said. A yen below 150 will force china to do something. and china's shere size is sooner or later finally becoming the dominant factor in asia (IMO).

nevertheless the Nikkei is a tradeable asset. Not at least b e c a u s e of interventions.


peace
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hey man! man!

how would a small time trader approach trading the nikkei? buying shares of docomo and hope they don't collapse oneday? you can't short the shares, and who knows how or why they uptick. charts on the nikkei intraday are about as useful as the policeman in my building right now trying to plug a leaky faucet--I guess the repairman got the hell out of dodge a long time ago. trade the nikkei futures? yeah, right...

I'm being only *slightly* ironic as there really is a policeman outside my building doing the plumbing.

The intraday gyrations on the nikkei make as much sense as this circus outside my front door. Actually, I kind of appreciate the cops chivalry....
 
I would not touch single japanese stocks. as you said -> futures. it is the only thing I am refferring to in this context.


peace
 
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