Hi Jay, I am only wondering why the analysis stopped at <<If depositors rushed to remove their money, banks would be forced to sell down their huge positions in Japanese government bonds to raise the cash, sending bond prices down and raising yields>> and not continued on with Japan savings allocated to other, and almost equally low yield government securities.
I remembered HK's liquidity tightness when the Japanese banks pulled their loans from the territories companies and individuals back in 1998/9, and as far as I know, the Japanese money never did come back to HK.
So, several events and threads of development can happen in 2002 ...
(a) Japan pulls capital from USA, causing global interest rate rise
(b) In effort to coordinate and produce a cure, G7 agrees that Japan and all others will print, print and keep printing
(c) Collapse of Yen, rise of NEM, Model Gold Portfolio sail through the year ...
Message 16830817
(d) Emerging economies not of critical mass sinks, resulting in bargains galore
Well, to the thread, why not?
Chugs, Jay |
