Market Round Up: Post Labor Day Blues  ☁ – Japan Woes 🙊

by | 4 Sep, 2018

 

1. Post Labor Day U.S. blues

Here’s a drab op-ed for those returning from a sunny break. Consensus shows that the U.S. Establishment needs to face up to the startling fact that its days of world geo-political and economic dominance are under threat.

Ever since the Soviet Union’s central economy collapse in the early 1990’s, the U.S. seems to have squandered its ace hand in terms of military, technology and finance. Since then, China has become the top exporter of hi-tech goods; China has become a military competitor in the Far East (South China Sea); average American household income has been static since 2000; the same labour force has shrunk from 67% to 63%; productivity has mouldered at 1% per year since the financial crisis; Federal debt has doubled between 2000 and 2018; and, as the Asia Times put so eloquently, the American economy has become “cartelized, corrupt and anti-competitive, dominated by a handful of tech monopolies that have crushed competition.”

So will things change? That’s what the American people are hoping for, and perhaps why they voted for an anti-Establishment leader.

Related: Market Round Up: Baidu’s Made in China, Brexit in the City, Factory orders give a pep

 

2. Japan’s woes linger

Japan has structural economic issues that just seem to deteriorate including an ageing population that has added to the costs of welfare. Japan’s Finance Minister Taro Aso confirmed that the budget plan for 2019 will likely hit a record high of around ¥102 trillion. This will no doubt be aimed at tackling Japan’s defence requirements to challenge the tensions between it and China. Meanwhile, talk in the markets continues about the prospect of the Bank of Japan (BoJ) conducting more “stealth” tightening. However, it’s worth remembering comments made by BoJ Governor Kuroda who reiterated last weekend that the BoJ does not plan to hike rates for “an extended time” and that the recent steps taken were not a precursor to any form of policy normalisation. We’ll see!

Related: The EU signals it may be ready to compromise with US over tariff dispute

 

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ALL RIGHTS RESERVED © INVSTR LTD. 2018

Risk Disclosure:
Invstr is a technology platform, not a registered broker-dealer or investment adviser. Invstr does not offer its own recommendations of any security or provide its own research to any user regarding any security transaction or order.
Please note, investing involves risk and investments may lose value. Past performance does not guarantee future results.
Brokerage services are provided by the following:
US-traded securities, including fractional trading, are provided to Invstr users by DriveWealth LLC, a regulated member of FINRA/SIPC. DriveWealth may not establish investment accounts to residents of certain jurisdictions. For more information, including disclaimers, risk and transaction fees click here.
India account traded securities are provided by SIC Stocks & Services PVT Ltd. SIC does not make any personal recommendations to buy, sell or otherwise deal in investments. Investors make their own investment decisions. The services and securities provided by SIC may not be suitable for all customers and, if you have any doubts, you should seek advice from an independent financial adviser. For more information and disclaimers, click here.

 

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