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Asia Channel: Latest Posts
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Asia
Timing Matters: Japan’s Massive Monetary Gamble
After two “lost decades,” Japan has begun a risky monetary gamble. Abenomics has the potential to make or break Japanese savings, Asian century, and global recovery. When the Bank of Japan (BOJ) concluded its highly-anticipated two-day policy meeting on April 4, 2013, a new era began in Japan. As the conservative caution of the previous [...]
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Asia
Vice Chairman of Chinese Accounting Association Warns Chinese Local Debt Could Create Bigger Crisis than US Housing Implosion
On the one hand, Bloomberg today tells us retail demand for stocks is as hot as ever: “Over the last few weeks, every down move has been met with buyers that have come in,” Brad Sorensen, director of market and sector analysis at San Francisco-based Charles Schwab Corp., said by telephone. His firm has $2.08 trillion in [...]
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Asia
Some New Estimates of Japanese Trade Elasticities
One component of Abenomics is a vigorously expansionary monetary policy. The yen has depreciated substantially as a consequence — as of February, about 20% relative to 2012Q3. One question is how much of an expenditure switching effect this depreciation will induce. In order to examine this question, I have done some quick and dirty econometrics, summarized in this paper. [...]
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Asia
The Significance of China’s Surprises This Week
Overshadowed by Japan’s ambitious monetary policy experiment, the heightened tensions from the Korean peninsula and the nearly 1/3 increase overall cost of the Cypriot adjustment (not to mention the collapse of the Bitcon Bitcoin), China was the source of a three surprises. First, Fitch became the first major rating agency to cut China’s local currency rating since [...]
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Asia
Some New Estimates of Japanese Trade Elasticities
One component of Abenomics is a vigorously expansionary monetary policy. The yen has depreciated substantially as a consequence — as of February, about 20% relative to 2012Q3. One question is how much of an expenditure switching effect this depreciation will induce. In order to examine this question, I have done some quick and dirty econometrics, summarized in this paper. [...]
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Asia
The Challenges for China’s New Leadership
The 2013 NPC and CPPCC Annual Sessions have ended with the formal selection of China’s new leaders. Not surprisingly there were few surprises. My quick take is that the leadership is saying all the right things, but they have been saying these things for quite a while – nearly two years in the case of [...]
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Asia
The Philippines as a BRIC Successor
Recently, the BRICS nations met in South Africa. Due to severe debt crises in the advanced nations, the growth prospects in these economies are no longer immune to the turmoil in the West. Among the emerging economies, the Philippines is best-placed for an upgrade. It is favorably positioned to sustain growth in an exceptionally grim [...]
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Asia
Asia Impulses Dominate Activity
The US dollar is narrowly mixed against the major European currencies, but the dollar-bloc is stronger and the yen continues to sport a soft profile, though within yesterday’s ranges. Events in Asia remain key to the global capital markets. China shocked the market by reporting a $880 mln trade deficit instead of a $15.4 bln [...]
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Asia
Why Abenomics Matters
Last week, I wrote on the ECB’s meeting and the case for easing credit conditions in the periphery (a recommendation that they didn’t heed, though pressure to act is building). I ignored the upcoming Bank of Japan (BoJ) meeting. My wife’s comment the next day summed it up well: “you blogged on the wrong central bank.” For [...]
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Asia
China Sovereign Wealth Fund’s Shifting Strategy
China Investment Corporation (CIC), the country’s main sovereign wealth fund, posted a 10.65% return on its overseas investment in 2012, registering an above 5% cumulative annualized return since its establishment in 2007. This is a significant improvement compared with the 4.3% loss last year, the fund’s worst performance in 5 years. As a young member [...]
