The Nikkei continued its celebration of the end of monetary sanity (I could certainly argue that it ended a while ago), the further suffering of savers and the further damage to the profitability of banks with a 2% rally to a one month high. Japanese yields are now negative out to 9 years with the 10 yr yield getting close at .05%, down by half overnight. Imagine how amazing the Japanese economy would have performed over the past 25 years if only extraordinary monetary policy works. Structural reform (labor market liberalization) and immigration is what will result in a faster growth rate in Japan. I’ll also say again, inflation/deflation are only symptoms, not the disease.
My quote of the day arrives early…thanks Peter!