Central Banks

Delirious Construction And Property Bubbles Prop Up China GDP (And Buy Social Stability For Now)

China’s economy grew barely above the government-decreed minimum of 7.5%. Deep frustrations simmer beneath the surface and can explode at any time. To maintain social stability, the government douses the land with money. Growth at any cost. But the results are majestic property and construction bubbles – and they can’t be inflated forever.

ECB’s Draghi: Knowing Too Much About Our Big Banks Could Set Off A Panic

European regulators are desperate. The only thing known about the holes in bank balance sheets stuffed with decomposing assets is that they’re deep. No one knows how deep. No one is allowed to know – not until Eurocrats decide who will pay for bailing out these banks. How do we know? ECB President Mario Draghi said that.

Hammered By Abenomics, Japanese Consumers Get Gloomier

A quarterly survey by the Bank of Japan brought a dose of reality to the glorious hype surrounding Abenomics, whose stated beneficiaries are the big banks and Japan Inc., including the formerly omnipotent nuclear power industry that Abenomics is trying to restore to its glory. But consumers are struggling with reality, apparently.

Supercars In The US, Japan, and China: How QE And Corruption Boosted Sales

Supercar-makers Lamborghini, Ferrari, and Rolls-Royce are reacting to the forces whacking global markets for luxury products: a corruption crackdown in China, Abenomics in Japan, and the Fed’s money-printing in the US. The idea that sales in China, which is printing billionaires by the dozens, are crashing is a hard-to-swallow concept for the industry.

Trade Is Supposed To Save Japan, According To The Gospel Of Abenomics, But In Reality…

Trade is one of the aspects that Abenomics designated as critical. So the Bank of Japan has embarked on a radical money-printing program to devalue the yen and make exports more competitive. It would also render imports so expensive that buyers would cut back. The resulting trade surplus would save Japan. In theory. In reality, the opposite is happening.

Revenge of the Japanese Zombie Banks

Japanese banks, which should know a thing or two about banking crises, have once again clawed their way to the top of the heap of overseas lenders. And with their knack for impeccable timing, they’ve once again become the largest force in emerging market economies – just as financial turmoil there is coming to a boil.

“We Don’t Feel Any Impact Of Abenomics Here”

For Japan’s megabanks, lending has rebounded. But instead of funding industrial projects in Japan, they’re funding acquisitions overseas and highfalutin real-estate speculation in Tokyo. They wrote up stock holdings and extracted fees from frenzied trading. Profits surged. They’re the prime beneficiaries of Abenomics. But smaller banks are not so lucky.

When “QE Infinity” Turns Into A Pipedream: Hot Money Evaporates, Rout Follows – See Emerging Markets

Printing money and forcing interest rates to near zero, that’s how the Fed and other central banks papered over the Financial Crisis, duct-taped the bursting credit bubble back together, inflated new asset bubbles, and propped up TBTF banks. It accomplished a huge feat: a worldwide tsunami of hot money. Which is now receding.

Why I’m Deeply Worried About Japan – And Why Betting On The Collapse Of JGBs Is A Horrible Idea

You don’t seem to “think Abenomics is working,” a reader wrote, followed by tough questions and a comparison to Kyle Bass, who has been betting on a “full-blown Japan crisis.” It got me thinking. I’m attached to Japan. What started in 1996 has turned into a complex relationship. But now that Abenomics is the religion of salvation, I’m even more worried.

The Dark Side Of The Guys Who Run Japan Oozes To The Surface

Japan’s Prime Minister Shinzo Abe skillfully used his miraculous economic salvation plan, a religion lovingly dubbed Abenomics, as a platform to catapult his party, the LDP, into power. With the LDP controlling both houses of parliament, real changes, after years of dickering, might now finally be possible.