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	<title>Japan &#8211; RFR</title>
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	<link>https://richesflores.com</link>
	<description>GLOBAL MACRO AND THEMATIC INDEPENDENT RESEARCH</description>
	<lastBuildDate>Fri, 28 Nov 2014 06:59:23 +0000</lastBuildDate>
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	<title>Japan &#8211; RFR</title>
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	<item>
		<title>Can Abe turn on the fountain of youth?</title>
		<link>https://richesflores.com/2014/11/28/can-abe-turn-on-the-fountain-of-youth/</link>
		
		<dc:creator><![CDATA[Véronique Riches-Flores]]></dc:creator>
		<pubDate>Fri, 28 Nov 2014 06:59:23 +0000</pubDate>
				<category><![CDATA[Japan]]></category>
		<category><![CDATA[WEEKLY]]></category>
		<guid isPermaLink="false">https://richesflores.com/?p=4843</guid>

					<description><![CDATA[At 17,357 points today, Japan’s flagship index has nearly doubled since Mr. Shinzo Abé took power in late 2012. Among the developed countries, it is by far the best performer. Its performance has been twice as strong as that of the S&#038;P 500 and three times that of the EUROSTOXX 50. The country’s paltry economic performance hardly justifies such a rise. Perhaps the BoJ’s pump priming is to be considered the lone explanation for the rocketing Japanese market, which would be analogous to recognizing that we are merely facing a giant speculative bubble. What factor would justify the Nikkei’s performance? Perhaps the belief that Abenomics has the magical power to combat the primary cause of the Japanese economy’s suffering: the ageing Japanese population?]]></description>
		
		
		
			</item>
		<item>
		<title>Bonds Gone Wild</title>
		<link>https://richesflores.com/2014/04/25/bonds-gone-wild/</link>
		
		<dc:creator><![CDATA[Véronique Riches-Flores]]></dc:creator>
		<pubDate>Fri, 25 Apr 2014 08:21:44 +0000</pubDate>
				<category><![CDATA[Japan]]></category>
		<category><![CDATA[United States]]></category>
		<category><![CDATA[WEEKLY]]></category>
		<category><![CDATA[T-Bonds]]></category>
		<guid isPermaLink="false">https://richesflores.com/?p=3504</guid>

					<description><![CDATA[Will they rise or won't they? There is no end to the uncertainty on the future direction of long-term interest rates. Impatience is growing as well, with, however, this paradox: the fear of being surprised by a precipitous drop in prices on the bond markets (i.e. rocketing long rates) contrasts with the long-held desire to see long rates increase, which would be a clear signal that economic conditions have improved. For nearly one year (since the start of the "taper caper"), the US market has been on edge. Now, the Bank of Japan has said it is concerned that Japanese bond ]]></description>
		
		
		
			</item>
		<item>
		<title>Global investment:  lingering disappointment</title>
		<link>https://richesflores.com/2014/04/11/global-investment-lingering-disappointment/</link>
		
		<dc:creator><![CDATA[Véronique Riches-Flores]]></dc:creator>
		<pubDate>Fri, 11 Apr 2014 13:45:08 +0000</pubDate>
				<category><![CDATA[Emerging]]></category>
		<category><![CDATA[Euro zone]]></category>
		<category><![CDATA[GLOBAL MACRO]]></category>
		<category><![CDATA[IN CHARTS]]></category>
		<category><![CDATA[Japan]]></category>
		<category><![CDATA[United States]]></category>
		<category><![CDATA[World Capital Formation]]></category>
		<guid isPermaLink="false">https://richesflores.com/?p=3518</guid>

					<description><![CDATA[The improvement in the global economic backdrop since late 2013 has not provided the desired results when it comes to investment. Although the European recovery has shown a few positive signs, an overview of global investment trends continues to paint a disappointing picture:
<ul>
	<li>In the U.S., where recent corporate earnings and leading indicators have fallen short of expectations;</li>
	]]></description>
		
		
		
			</item>
		<item>
		<title>Mr. Draghi Seems Quite Sure of Himself…</title>
		<link>https://richesflores.com/2014/03/07/mr-draghi-seems-quite-sure-of-himself/</link>
		
		<dc:creator><![CDATA[Véronique Riches-Flores]]></dc:creator>
		<pubDate>Fri, 07 Mar 2014 12:01:36 +0000</pubDate>
				<category><![CDATA[Euro zone]]></category>
		<category><![CDATA[GLOBAL MACRO]]></category>
		<category><![CDATA[Inflation]]></category>
		<category><![CDATA[Japan]]></category>
		<category><![CDATA[Monetary Policy]]></category>
		<guid isPermaLink="false">https://richesflores.com/?p=3076</guid>

					<description><![CDATA[The President of the ECB is confident in his ability to stare down deflation risk and bring the inflation rate up to its official target of 2%...on a 2016 horizon. Well that was reassuring; the euro celebrated the news by increasing to USD 1.386 this morning, a record since October 2011! Could we have expected anything different? Apparently not. The ECB wasn’t about to shoot itself in the foot by announcing that its forecast pointed to a deflationary scenario, tacitly recognizing that it would fail in its deflation battle]]></description>
		
		
		
			</item>
		<item>
		<title>Global Inflation &#8211;  Disinflation Is Gaining Ground Across the Globe</title>
		<link>https://richesflores.com/2014/03/07/global-inflation-disinflation-is-gaining-ground-across-the-globe/</link>
		
		<dc:creator><![CDATA[Véronique Riches-Flores]]></dc:creator>
		<pubDate>Fri, 07 Mar 2014 08:00:04 +0000</pubDate>
				<category><![CDATA[Emerging]]></category>
		<category><![CDATA[Euro zone]]></category>
		<category><![CDATA[IN CHARTS]]></category>
		<category><![CDATA[Inflation]]></category>
		<category><![CDATA[Japan]]></category>
		<category><![CDATA[United States]]></category>
		<category><![CDATA[Commodities]]></category>
		<guid isPermaLink="false">https://richesflores.com/?p=3093</guid>

					<description><![CDATA[At the global level, disinflation is gaining ground. After a temporary rebound during spring, global inflation continued its downtrend in the second half of 2013 and ended the year at 3.2%. Inflation remains very weak in the developed world, at 1.3% in December, and has also sagged in many emerging markets in recent months, to finish 2013 at 6.1%. <br/>

In fact, as of December 2013, nearly half the countries (39) in our sample of 80 countries had inflation rates of less than 2%, which is markedly higher than a year ago (24). T]]></description>
		
		
		
			</item>
		<item>
		<title>Scenario 2014–2015 : The Roller Coaster Economy</title>
		<link>https://richesflores.com/2014/01/17/scenario-2014-2015-the-roller-coaster-economy/</link>
		
		<dc:creator><![CDATA[Véronique Riches-Flores]]></dc:creator>
		<pubDate>Fri, 17 Jan 2014 21:15:21 +0000</pubDate>
				<category><![CDATA[Emerging]]></category>
		<category><![CDATA[Euro zone]]></category>
		<category><![CDATA[FORECASTS]]></category>
		<category><![CDATA[Global Trends]]></category>
		<category><![CDATA[Japan]]></category>
		<category><![CDATA[United States]]></category>
		<guid isPermaLink="false">https://richesflores.com/?p=2736</guid>

					<description><![CDATA[2014 is off to a positive start: U.S. growth is trending upward, the euro area is pulling out of recession, Japan is reaping the benefits of its competitive strategy, and world trade is picking up. All these bright spots should be enough to end two years of global deceleration and bring about a return to growth of over 3 percent this year. But while this is certainly good news, it doesn’t tell us much about the key challenges ahead. To understand them, we need to address the much more complex question of whether 2014 will usher in a second leg of the global recovery—one that is sufficiently sturdy to ensure a lasting upswing and leave five years of convalescence well behind us. As things now stand, we feel we still have two good reasons for assuming it won’t]]></description>
		
		
		
			</item>
		<item>
		<title>A Fresh Round of Central Bank Action Coming Up in 2014</title>
		<link>https://richesflores.com/2013/10/04/a-fresh-round-of-central-bank-action-coming-up-in-2014/</link>
		
		<dc:creator><![CDATA[Véronique Riches-Flores]]></dc:creator>
		<pubDate>Fri, 04 Oct 2013 16:51:49 +0000</pubDate>
				<category><![CDATA[Euro zone]]></category>
		<category><![CDATA[GLOBAL MACRO]]></category>
		<category><![CDATA[Japan]]></category>
		<category><![CDATA[United States]]></category>
		<category><![CDATA[central banks]]></category>
		<category><![CDATA[ECB]]></category>
		<category><![CDATA[Interest Rates]]></category>
		<guid isPermaLink="false">https://richesflores.com/?p=2237</guid>

					<description><![CDATA[If we’re correct in assuming the Federal Reserve is not about to start scaling back its asset purchases, worldwide liquidity injections should hit a new high next year. Whereas the aggregate balance sheet of the four leading central banks showed little change in the first half of 2013, we can expect widespread central bank activism over the next few quarters:
- At a rate of 85 billion dollars a month, the Fed’s asset purchases should amount to 1.02 trillion dollars a year.
- The Bank of Japan will be adding anywhere from 600 to 718 billion dollars to its balance sheet as it strives to meet its target of expanding Japan’s monetary base by between 60 and 70 trillion yen a year (making it some 40 percent larger than at the beginning of 2013).
- The Bank of England will be buying 610 billion dollars’ worth of Gilts in connection with its objective to purchase 375 billion pounds of assets via its Asset Purchase Facility. 
- The ECB’s probable upcoming LTRO is likely, in our estimate, to provide]]></description>
		
		
		
			</item>
		<item>
		<title>Japan Bull Markets Die of Anemic Demand</title>
		<link>https://richesflores.com/2013/08/03/2035/</link>
		
		<dc:creator><![CDATA[Véronique Riches-Flores]]></dc:creator>
		<pubDate>Sat, 03 Aug 2013 08:26:00 +0000</pubDate>
				<category><![CDATA[GLOBAL MACRO]]></category>
		<category><![CDATA[Investment themes]]></category>
		<category><![CDATA[Japan]]></category>
		<category><![CDATA[Japan economy]]></category>
		<guid isPermaLink="false">https://richesflores.com/?p=2035</guid>

					<description><![CDATA[True, the substantial depreciation of the yen brought about by the BoJ policy of massively injecting liquidity into the system has driven up corporate profits since the start of the year—even way up in some cases. But this competitive surge has had such a depressive effect on other economies in the region that they now offer a shrinking market for Japanese goods. In fact, what Japan is exporting may well be its own deflation, and to a degree at least commensurate with the inflation target set by the government.

So what can be expected of “Abenomics” if it fails to engineer a rebound in exports? Domestic forces certainly won’t generate inflation: population aging has already done serious damage to the country’s growth potential, and encouraging mass immigration -the only solution- is simply not on the government agenda today... What follows is a new analysis of this issue by Frank Benzimra, one that concludes with the firm recommendation to dump Japanese equities.
]]></description>
		
		
		
			</item>
		<item>
		<title>Tenkan!</title>
		<link>https://richesflores.com/2013/05/02/tenkan-2/</link>
		
		<dc:creator><![CDATA[Véronique Riches-Flores]]></dc:creator>
		<pubDate>Thu, 02 May 2013 14:37:30 +0000</pubDate>
				<category><![CDATA[GLOBAL MACRO]]></category>
		<category><![CDATA[Investment themes]]></category>
		<category><![CDATA[Japan]]></category>
		<category><![CDATA[Interest Rates]]></category>
		<category><![CDATA[Investment Strategies]]></category>
		<category><![CDATA[Monetary Policy]]></category>
		<category><![CDATA[Tenkan]]></category>
		<guid isPermaLink="false">https://richesflores.com/?p=1521</guid>

					<description><![CDATA[“Tenkan, a term in several martial arts for a swift, 180-degree pivoting move, has provided the economist and Asia specialist Jacques Gravereau with an analogy for illustrating the ability of the Japanese people to carry out radical changes in direction collectively, flexibly, and energetically.”

Does the policy shift initiated a few months ago by the Japanese authorities qualify as tenkan? On this one, the jury is still out, but in any event, this experiment already represents a key stage in the crisis affecting the developed countries. 

To highlight its importance, we are publishing two papers on this question. The first one, a brief attempt to put Japan’s deflationary episode into perspective, seeks to shed light on why the country was previously in so little of a hurry to deal with this affliction, and why it now feels compelled to take an entirely new tack. 

The second paper is by Frank Benzimra, a specialist on the Japanese economy and financial markets based in Asia for about ten years, who has been kind enough to share his thoughts with us. He begins by explaining how Japan managed to make it through fifteen years of extremely high public debt without lapsing into chaos. He then goes on to discuss the pioneering aspects of Prime Minister Abe’s new policy. In conclusion, he puts forward three possible scenarios for the outcome of “Abenomics,” along with the three investment strategies they imply. 
Departing from our usual practice, we are publishing this contribution in English.]]></description>
		
		
		
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