When running up debt over twice your GDP doesn’t help your economy recover, what’s left? Japan is switching gears and will reportedly try fiscal stimulus — this only two months after a 25% hike in sales taxes. The market is unclear how the $239 billion stimulus will be funded – but it supposedly involves some private money. Uh…right. Because negative interest rates are such an investment magnet.
Prime Minister Shinzo Abe, after whom the failed Abenomics is named, explains: “We shouldn’t miss this chance, this is exactly when we should accelerate Abenomics and overcome our challenges.” It if was simply an expansion of the money printing and stock purchasing going on, markets might have been enthused. As it is, though, USDJPY is having trouble even pushing above its SMA200.
Even US futures, the great catch-basin of monetary stimulus efforts, are yawning.
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