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Banking insider: The Japanese have lost control of their bond market (Photos)

• Stock Market
  
• May 25, 2013
  
• By: Kenneth Schortgen Jr
  
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On May 24, a financial analyst and former head trader at the
Royal Bank of Scotland spoke on the Hagmann and Hagmann Report regarding
the current state of the global economy. Known in the public sphere under the pseudonym of 'V',
and labeling himself the Guerrilla Economist, this high level insider
stated that the Japanese have completely lost control over their bond
market, and the threat for a collapse of the Nikkei equities market is
very likely.


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• Stock Market
  
• Japan
  
• global economy
  
• V
  

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<blockquote>V: I basically just got this hot off the press, and hot
from the board rooms over here. The Japanese, and this is official...
I'm going out on a limb saying this, and you can take it for all it's
worth... the Japanese have lost control of their bond market.

Doug Hagmann: V, for financial neophytes like me, what does that mean?

V: What that simply means is... see the stock market has been rising in Japan,
as well as over here because of bond prices. Were in a very unique
environment where, if the bond market goes bust, you're going to see the
Nikkei go bust with it, as well as real estate.

That also coincides with us. The collapse that is going to occur
here, is going to be a trifecta of bonds, stocks, and real estate
combined. So when the Japanese have lost control of their bond market,
and the yields are getting higher and higher, and the interest rates are
starting to climb on it, nobody's buying it. So right now, the Bank of
Japan has ordered all the public pension funds to begin to buy the
Japanese debt. - V, Hagmann and Hagmann Report, May 24

</blockquote>

SEE THIS ALSO:

http://www.zerohedge.com/news/2013-05-24/bnp-warns-japanese-repression-echoes-1940s-fed

http://www.zerohedge.com/news/2013-05-27/6-sigma-catalyst-cracked-japanese-stocksIs This The 6-Sigma Catalyst That Cracked Japanese Stocks?









Submitted by Tyler Durden on 05/27/2013 20:06 -0400






Many are still wondering who (or what) stole
the jam from the Japanese stock market's doughnut just three short days
ago. Some blame an out-of-control bond market; others fear members of
the BoJ recognizing they have blown the bubble too big too soon; still
more fear the jawboning on JPY devaluation that has seemingly
about-faced recently. The reality is - none of these were surprises or
new to the marketplace. But in this world of free-flowing totally
fungible central bank liquidity, we suspect the following chart is the
real answer. Simply put, the S&P 500's bubble just couldn't keep pace with the Nikkei 225's and with USDJPY unable to support the relative price appreciation difference - the six-sigma richness of Japan to the US was just too much. Two-and-a-half months of 'outperformance' undone in 3 days leaves the question - is it over?







While CME positioning shows futures traders the most net short the
JPY (against the USD) since 2007 (recently making new lows)...





...it seems traders (perhaps to avoid telegraphing their intentions to the broader market) are furiously hedging their short JPY positions in the 'Mrs.Watanabe-exempt' FX options market. As the following chart of USDJPY risk-reversals (a simple way of visualizing the market's preference for hedging upside vs downside), the options market is decidedly less confident at Abe's ongoing success.







... and if USDJPY drops back to the levels implied by the options
market, then the Nikkei has a long way to fall still (and we suspect
European sovereigns, US bond-like-stocks, and High yield credit).


Charts: Bloomberg

http://www.prisonplanet.com/the-japanese-financial-system-is-beginning-to-spin-wildly-out-of-control.html





The Japanese Financial System Is Beginning To Spin Wildly Out Of Control

• 
  

Michael Snyder
Economic Collapse
May 28, 2013

The financial system of the third largest economy on the planet is
starting to come apart at the seams, and the ripple effects are going to
be felt all over the globe. Nobody knew exactly when the Japanese
financial system was going to begin to implode, but pretty much everyone
knew that a day of reckoning for Japan was coming eventually. After
all, the Japanese economy has been in a slump for over a decade, Japan
has a debt to GDP ratio of well over 200 percent and they are spending
about 50 percent of all tax revenue on debt service. In a desperate
attempt to revitalize the economy and reduce the debt burden, the Bank
of Japan decided a few months ago to start pumping massive amounts of
money into the economy.

At first, it seemed to be working. Economic activity perked up and
the Japanese stock market went on a tremendous run. Unfortunately,
there is also a very significant downside to pumping your economy full
of money. Investors start demanding higher returns on their money and
interest rates go up. But the Japanese government cannot afford higher
interest rates. Without super low interest rates, Japanese government
finances would totally collapse. In addition, higher interest rates in
the private sector would make it much more difficult for the Japanese
economy to expand. In essence, pretty much the last thing that Japan
needs right now is significantly higher interest rates, but that is
exactly what the policies of the Bank of Japan are going to produce.

There is a lot of fear in Japan right now. On Thursday, the Nikkei
plunged 7.3 percent. That was the largest single day decline in more
than two years. Then on Monday the index fell by another 3.2 percent.

And according to Business Insider, things are not looking good for Tuesday at this point…

<blockquote>In post-close futures trading, the Nikkei has dropped by another couple hundred points, and has dropped below 14,000.
</blockquote>
Are we witnessing the beginning of a colossal financial meltdown by
the third largest economy on the planet? The Bank of Japan is starting
to lose control, and if Japan goes down hard the crisis could spread to
Europe and North America very rapidly. The following is from a recent
article by Graham Summers…

<blockquote>As Japan has indicated, when bonds start to plunge, it’s not good for stocks. Today the Japanese Bond market fell and the Nikkei plunged 7%. The entire market down 7%… despite the Bank of Japan funneling $19 billion into it to hold things together.

This is what it looks like when a Central Bank begins to lose
control. And what’s happening in Japan today will be coming to the US in
the not so distant future.

If you think the Fed is not terrified of this, think again. The Fed
has pumped over $1 trillion into foreign banks, hoping to stop the mess
from getting to the US. As Japan is showing us, the Fed will fail.

Investors, take note… the financial system is sending us major warnings…

If you are not already preparing for a potential market collapse, now is the time to be doing so.
MORE@LINK BUT YOU GET THE DRIFT RIGHT?

</blockquote>

http://www.bbc.co.uk/news/business-22714353

30 May 2013 Last updated at 05:50 ET

Japan's Nikkei dives a further 5%
Continue reading the main story
Nikkei 225 Index
Last Updated at 30 May 2013, 02:45 ET Nikkei 225 one month chart
value change %
13589.03 -
-737.43
-
-5.15
Continue reading the main story
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Japanese stocks recover after falls
Japan market 'driven by sentiment' Watch

Japan's Nikkei index dived a further 5% on Thursday to hit a five-week low, amid predictions of a bigger correction from some analysts.

The fall means the Nikkei has lost 8.3% since reaching a five-and-a-half-year high just a week ago.

Trading in Tokyo has been volatile amid concerns over global growth and the future of US stimulus measures.

Japanese government officials have played down the significance of the falls, suggesting they are "temporary".

"Share prices appear to have been undergoing temporary adjustment over the past week," Japan's chief cabinet secretary, Yoshihide Suga, told reporters.

"A rise in share prices over the past month has been extremely rapid... In that regard, it would be unnatural if adjustment did not occur."

Other traders suggested investors were still on edge following a 7% fall in stocks in a single day last week, as well as concerns that the yen is rising again, potentially hurting Japanese exporters.

Massive stimulus measures introduced by the Japanese government initially caused big falls in the yen against other currencies.

There is also some uncertainty over how long the US Federal Reserve will continue to pump liquidity into the US market.

Ha Ha Ha, that is the best post to look at first after being hacked and loosing the work horse!

Very good, lot of laughs.

http://www.rumormillnews.com/cgi-bin/forum.cgi?read=278676

NIKKEI DOWN 3.72% - FOURTH MAJOR FALL IN LAST EIGHT SESSIONS

Posted By: IZAKOVIC [Send E-Mail]
Date: Monday, 3-Jun-2013 15:20:06

DJ: Shares End At 6-Week Low As Retail Investors Bail Out

TOKYO--Tokyo stocks booked their fourth major fall in the last eight sessions Monday as selling on the back of weakness in the dollar, disappointing Chinese ...

http://e.nikkei.com/e/fr/marketlive.aspx

---

IZAKOVIC
http://www.deepsapce4.com