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    Takeaways from Japan Nov-Dec 2013

    During my recent trip to Japan, I met with a selection policy-makers, private-sector researchers, academics, corporate executives, political analysts, and financial market participants. Having aggregated my observations, I summarise below the key assumptions held before my recent visit to Japan in Nov-Dec 2013, and key takeaways after finishing the trip:   Takeaways First arrow: We might see that policy-making at the BOJ has fundamentally changed under Kuroda, and not only because…

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    Abenomics Q&A December 2013

    As I have elaborated in my views on “Abenomics and the Japanese Wealth Gap”, reflation is the basis upon which any future reforms (fiscal and structural) might take place, and the balance is a delicate one. The best possible scenario for Japan is one in which the US experiences a gradual, reflationary recovery, boosting asset prices (and Japanese stock), which in turn will add credibility to Abe’s economic policy platform (though it still places the BOJ in a precarious position when in regard to debt monetization). Reflation then makes the consumption tax hike more palatable, which when enacted shores up fiscal credibility, thereupon opening up the pathway to structural reform as well.

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    Abenomics and The Wealth Gap

    Wealth gap: Japan has been spreading the disutility As asset markets recover, and as the prices of select everyday goods start to rise, consumers have begun to feel the pressures of the lagging rise in wages.  Some have voiced their concern that the pattern heralds increasing inequity between investors and wage earners. This may well be a valid concern, but it is probably too early, if not entirely incorrect, to…

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