Posted on 10/30/2014 10:39:35 PM PDT by steve86
That’s fine. I don’t wish to get into a big argument over it. I have my theories.
At market close backed off a little from the +822 I saw. Missed the 52-week high by over a hundred points.
What kind of tax structure does Japan have, for them to have been in a slump for almost thirty years? It must be brutal. They were supply-siders for a short time, I think.
Supply-side tax policies always succumb to greed and envy. People just cannot tolerate low tax rates for “the rich.”
It’s not the direct taxes (e.g. income taxes and sales taxes) that are Japan’s problem.
Japan’s problem is: “the problem whose name shall never be mentioned.”
Over-regulation. Japan has near zero legal immigration and more than 200% over-regulation by a network of regulatory authorities, bureaucracies, agencies, as well as city and national governments.
Since speaking of “over-regulation” is prohibited, the pundits talk only of Japan’s poor demographics (e.g. declining birth rates) and its need for “Stimulus” as if the Stimulus in 1989 wasn’t enough so the Stimulus of 1990 was needed, but it wasn’t enough so they had to do a Stimulus in 1991...and in fact have pretty well done some form of government money-pumping on a massive scale every year since to date.
...but it’s their hidden tax of over-regulation that is killing them.
How can Japan innovate new 3D printers when it is illegal there to 3D print useful products such as firearms?
How can Japan innovate new crops when GM seeds are prohibited there?
Japan’s farming rules alone prevent japan from even *copying* the U.S. hyper-farming revolution, much less innovating such a thing there first.
Ever hear of much private aviation in Japan? Tough to innovate when you are regulated out of the industry.
That’s their hidden tax, and it’s an economy-killer.
Japan is a hive society/nation. Karl Marx would be comfortable living there.
>> What is this about? No where else to put their investments?
Gold is at $1173; maybe they’re selling unproductive investments like gold and putting the money into something that performs, and yields.
Only ZeroHedge could come up with the term, “Buying Panic”.
Got to sell those gold futures.
One is reminded of global warming kooks who find a way to blame everything on global warming.
How about our own DOW? Almost 18K, down to almost 16K and now on the way towards 18K again - all in a 3-4 week period. Almost getting whiplash from it.
>> Only ZeroHedge could come up with the term, “Buying Panic”.
For my own purposes, I have renamed them “ZeroCredibility”.
“Tyler Dunderhead”.
Spot on. It’s happening here as well. The next President can cause an economic boom by simply reducing the level of regulation back to the already excessive level of the GW Bush Presidency.
ZH does good work but he is over invested in conspiracy/the world is going to end theories. Good charts though :-)
“Japan has been doing QE, and failing, since 1989.
The U.S. just ended QE. Our GDP is up 3.5% this Quarter.”
Sorry, but you are wrong on that. QE was about injecting liquidity. The BOJ did not do that all those years. They kept interest rates very low but the fiscal policy of Japan, even under this Abe Administration, was very restrictive. High tax rates (he even RAISED the consumption taxes the last few years), cumbersome regulations and the inability to structurally reform (i.e.-the inability to reform their corporate laws and their agriculture policies) have kept the low rates from having much effect.
Although I agree with your assessment of ZeroHedge, the term Buying Panic has been around in this country for decades. Adam Smith used it in Supercurrency in the 70’s to describe what happened when Lyndon Johnson announced he wasn’t running for re-election.
You could also see it used when Volcker finally announced that the Fed was easing in the early 80’s.
I’m sure you are correct, but it is perfect for Zero Hedge.
Other possible ZeroHedge terms:
Depressing happiness
Dangerous stability
Chicken Little was right!
Buying Panic is not a term coined by ZH. Buying Panic is actually one of the stages of a manic market.
When a market goes up this fast, it usually doesn’t have the legs to stand for very long. This is not the sign of the “good market” where people move their assets back in. It is a sign of folks rushing to catch up. Usually the only ones who make out are the very first in. That would have been a couple of days ago.
People rushing to buy now will be rushing soon for the doors. They are most likely over margined and looking for the fast dollar. When it turns south...they will panic to get out.
There are a lot of things going on right now. The direct conversion of Chinese Currency into Rubles and Indonesian currency. The price of oil is killing Russian exports, and thus their economy. This crazy stuff in Japan, the pressure on banks in Europe—25% of whom could not pass their stress test, and finally, the turning off of the spigots at the Fed.
I cannot imagine that all of this stuff—most of which seems pretty negative—will end with a smoothed out landing of our stock market or our economy.
Back in ‘99 and ‘00 I was a deep believer in dot.com stocks. At that point the wise men were saying, “Its a bubble, watch out. Get out.” I find myself more and more on that side of the game now.
And when the market has a crash for two days in 2022 when the Dow goes from 36,106 to 31,094 they’ll claim credit . . .
and we can then say . . .
Even a blind squirrel finds an acorn every now and then.
Buying panic is a pretty common feature of Asian equity markets. Asset managers who have gone to cash, or gotten short, get desperately afraid of falling short of the index. US equity managers are less closely tied in fees / pay to indices, and tend avoid this by not going to cash or short in the first place.
They were NEVER supply-siders. The whole country is run on a mercantilist model. Favorite corporate structures, protected agriculture and all the rest are regulated for the good of the favored industries.
In short, everything today’s progressives believe in short of nationalization.
As “Kwave” said, “Never before in history has the DOW closed below the 50 week MA and then 2 weeks later closed at new ATH highs”.
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