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Strategies & Market Trends : The Epic American Credit and Bond Bubble Laboratory -- Ignore unavailable to you. Want to Upgrade?

To: UncleBigs who wrote (54565)	2/23/2006 11:58:58 AM
From: Paul Kern	Respond to of 110194

I see TOL heading back to the teens in time. So far, I've done well with puts at six or more months out. Then I don't pay so much attention to the short term gyrations except for looking at entry and exit points.

To: UncleBigs who wrote (54565)	2/23/2006 1:16:53 PM
From: russwinter	Read Replies (1) \| Respond to of 110194

Notice it's not exports that's the problem here, it's the high cost of imports especially commodities and energy. A higher valued Yen would offset this. Japan posts biggest trade deficit for 23 years, first in five Thu Feb 23, 2:22 AM ET TOKYO (AFP) - Japan reported its largest monthly trade deficit for almost a quarter century and the first for five years, as the New Year holidays hit exports to Asia and its oil import bill soared. The trade balance slumped to a deficit of 348.9 billion yen (2.95 billion dollars) in January compared with surpluses of 911.9 billion yen in December and 193.9 billion yen a year earlier. It was also more than three times bigger than the expected shortfall of about 102 billion yen. The deficit was the largest since January 1983 and only the third in two decades. Exports in January rose 13.5 percent to 5.01 trillion yen while imports expanded 27 percent to 5.36 trillion yen, the finance ministry said. Financial markets took the data in their stride as analysts said the weak figures were largely due to seasonal factors and high oil prices, and were unlikely to derail Japan's economic recovery. "Aside from the effects of high oil prices, growth in imports in general can be interpreted as a sign that domestic demand is robust, another reason to say the Japanese economy is on the right track," said Koji Kobayashi, senior economist at Mizuho Research Institute. "Usually January is the month when the value of exports declines due to New Year holidays in Japan. I would say the deficit will disappear in February," Kobayashi predicted. Taro Saito, senior economist at NIL Research Institute, said that China's Lunar New Year holidays appeared to be an additional factor for what he described as "irregular fluctuations" in the trade data. "As the Lunar New Year in 2006 started at the end of January, this could have contributed to the decline in exports to Asia," he added. Japan's trade surplus ballooned in the 1980s and 1990s, becoming the envy of other industrialized nations. However it failed to usher in an era of steady growth and the world's number two economy stagnated for a decade after its "bubble economy" burst in the early 1990s. Analysts say this time around, rising exports are accompanied by a pick-up in corporate and consumer spending although soaring energy costs are hurting the Japanese economy, which gets most of its oil and coal from overseas. "The wider-than-expected deficit is due to high oil prices, which have now peaked. The growth in the value of imports will not last as we expect crude prices will cool later this year," said Kobayashi of Mizuho Research. "Exports will stay on a recovery trend as we expect the world economy will be on an uptrend in the first half of this year," he added. Crude oil imports jumped 67.2 percent while the value of imports of electronic parts was up 35.7 percent year-on-year, the ministry said. Exports to the United States rose 21.7 percent for a 12th straight monthly increase, with shipments to the European Union up 14.8 percent for a third consecutive monthly increase, the ministry said. At the same time, however, exports to Asia managed only a modest increase of 5.1 percent. "On the whole, the recovery in exports seems to be resilient as the value of exports to the United States and to the European Union grew steadily in January," said Saito. Investors shrugged off the data as the Tokyo Stock Exchange's benchmark Nikkei-225 index closed up 314.32 points or 1.99 percent at 16,096.10. Japan's government upgraded its view on the economy Wednesday for the first time for six months, after reporting last week blistering 5.5 percent annualized growth in the December quarter.