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Japanese conundrum

The Japanese equity market has reached a new all time high after 35 years. A real estate crisis in the 80’s ended the incredible run for the Japanese market that was followed by almost three decades of deflation. In 2012, Shinzo Abe started his new economic program known as #abenomics with its three arrows: aggressive monetary program, fiscal consolidation and growth strategy. You can see the results of the program below, almost 12 years later, after several trillion Yen printed by the #boj and invested in the equity market. The Japanese government is now the top shareholder of every single stock in the market and owns 5% of the whole market. The balance sheet has expanded 4X since the start of the program and the Yen has weakened to 150 vs the USD. The big question remaining is how to unwind that program.

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