From Bloomberg: Asian Banks "Central banks outside the U.S., including those of Japan and China, are the largest foreign holders of U.S. government debt. Japan's holdings of Treasuries last year soared 44 percent to $545.2 billion from $378.1 billion. They are up 72 percent from the Dec. 2001 level of $317.9 billion." Japan now rules the globe through setting currency prices. Buy Yen. Hold Yen. Get rich. Sam
Buy yen? Japanese banks have been holding their country's equities for decades as the equity keeps depreciating. They cannot close out the positions because then the loss has to get recognized. If you think US is in a bad position, Japan is 10 times worse. But everything is kept nice and quiet and holding off the catastrophe as long as possible.
Heresay and rumors. Give me documentable facts. You have none. Japan being the majority holder of USD debt IS a fact. That is a main key to why they thru the yen can and do set global currency trading ranges and prices thus rule the globe. Therefore making the yen the most powerful currency in the world. Sam
Merco is correct Sam. Japan is a mess. I'm sure he could find a dozen articles giving the facts for you, but that would take time, and you weren't exactly polite to the guy. Jay
Doesn't matter how much debt they hold. This gives them no power whatsoever to move rates. What are they gonna do, sell off the debt? Besides the massive losses they would take on the positions, it may even cause the dollar to RISE vs the Yen. Why? Because it could hurt them more than us. Without us buying their goodies, they are toast! As in serious depression. Currencies are funny that way. Its all about future expectations. Jay
Jay: noted. However you and Merco see Japan, this does not automatically make the USA a great economy. I happen to live in the USA and see how massively messed up it is every day and in every way. The same sentiment and facts constantly repeated by governors to Greenspan, that he "lives in another world." Not the world they live in - the USA. Plus, for Japan to move the yen down in price anymore than the 111 - 112 level would be a "brutal currency move." That is against G-7, G-10 and G-20 globally agreed upon policy that Japan's central bankers helped establish. Japan is prohibited from weakening the yen. As soon as the corporations in Japan book their profits BOJ will let the USD slide against the yen back down to the 105 level, probably lower. Cheers! Sam