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Re: Japan - Their 20 year Downturn and their Investors.............
Old 10-28-2005, 08:42 PM   #21
 
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Re: Japan - Their 20 year Downturn and their Investors.............

Quote:
Originally Posted by wab
* I hope it doesn't happen here, but I consider Japan my worst-case scenario. * Much worse that the Great Depression from a long-term financial perspective.
A much bigger bubble and far more corruption (Hard to believe, I know)

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Re: Japan - Their 20 year Downturn and their Investors.............
Old 10-28-2005, 08:52 PM   #22
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Re: Japan - Their 20 year Downturn and their Investors.............

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Originally Posted by Cut-Throat
A much bigger bubble and far more corruption (Hard to believe, I know)
Yeah, hard to believe. The peak 1929 P/E ratio was around 60 before the GD. In Japan, it was about 70. As far as corruption, we had sweeping changes in security laws due to that bubble in the US.

BTW, do you know what the peak P/E was for the NASDAQ during our most recent bubble? 125.9 on March 7, 2000. Do you think we've already let all the air out of that bubble? I hope so.
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Re: Japan - Their 20 year Downturn and their Investors.............
Old 10-28-2005, 08:53 PM   #23
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Re: Japan - Their 20 year Downturn and their Investors.............

One has to prefer a market like Japan that has already crashed to one like the USA that has not, but I can't see a credible scenario where the US gets into trouble and Japan doesn't.

The main problem with the whole world is the US consumer of last resort, and overheated and unbalanced economies feeding that US consumer on credit. Japan directly feeds him with cars and high end electronics, and indirectly feeds him with machine tools exported to China, Malaysia etc, offshore manufacturing throughout Asia. etc.

Japan may come through quicker, but if our economy goes down so does theirs IMO.

I nevertheless hold some Japanese stocks, which have really been strong lately. I have already taken some profits, and I plan to be gone at the first sign of a US recession.

Ha
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Re: Japan - Their 20 year Downturn and their Investors.............
Old 10-28-2005, 09:04 PM   #24
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Re: Japan - Their 20 year Downturn and their Investors.............

In terms of corporate governance, the one name I have heard is Hoya as being responsive especially to foriegn investors.

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Sure, short term, Japan and everyone else will keep following the US's appetite. *Long term, that doesn't seem sustainable, so I think the directions of trade will of necessity become more diffuse around the globe (unless somebody else takes over the role of being the world's mouth, but I hope against such an inherently unstable outcome.)
Japanese seem to doing their best to diversify

People I have talked to think Japan badly misjudged China and Korea and has a real chance of losing out to them. The Japanese thought the Chinese were going to follow a standard development model. Progessing along a ladder. Instead they are developing at every rung simultaneously. The Koreans have really come along since the asian crisis.

Japanese risk behavior puzzles me. It seems they either won't touch anything without a principal guarantee with a ten foot pole or they are day trading. I have had a couple of students ask me about day trading recently. Strange
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Re: Japan - Their 20 year Downturn and their Investors.............
Old 10-28-2005, 09:13 PM   #25
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Re: Japan - Their 20 year Downturn and their Investors.............

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Originally Posted by mikew
Japanese risk behavior puzzles me. It seems they either won't touch anything without a principal guarantee with a ten foot pole or they are day trading. I have had a couple of students ask me about day trading recently. Strange
I think we're just seeing the cycle time speed up due to the internet (the great financial data democratizer).* *I figure we're going to have a bubble and depression cycle every 10-20 years now.
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Re: Japan - Their 20 year Downturn and their Investors.............
Old 10-28-2005, 09:21 PM   #26
 
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Re: Japan - Their 20 year Downturn and their Investors.............

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BTW, do you know what the peak P/E was for the NASDAQ during our most recent bubble? * 125.9 on March 7, 2000. * Do you think we've already let all the air out of that bubble? * I hope so.
What 's the current P/E of the NASDAQ?

BTW - Ihave read that the peak of the Japanese Market was twice that of the U.S Peak beofre 1929. And real estate was out of this world. Like Tokoyo was worth more than all of the U.S. *- I have also read that real estate was their downfall more than stocks.

Do you have any handy stats?
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Re: Japan - Their 20 year Downturn and their Investors.............
Old 10-28-2005, 09:52 PM   #27
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Re: Japan - Their 20 year Downturn and their Investors.............

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Originally Posted by Cut-Throat
What 's the current P/E of the NASDAQ?
QQQQ is around 26 now.* *Typically, when a bubble collapses, P/E's go below 10.* *Hasn't happened to the naz (yet).

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BTW - Ihave read that the peak of the Japanese Market was twice that of the U.S Peak beofre 1929.
Depends on how you measure, I guess.* *Market P/E's were similar, but market cap as a percent of GDP were different.* *Something like 140% in Japan vs 80% in the US.

Quote:
And real estate was out of this world. Like Tokoyo was worth more than all of the U.S. *- I have also read that real estate was their downfall more than stocks.

Do you have any handy stats?
I couldn't find much to compare their real estate market to ours.* *But our real estate market is currently valued at about 140% of GDP, which is just as big as their stock bubble.

Here's an interesting graph:

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Re: Japan - Their 20 year Downturn and their Investors.............
Old 10-28-2005, 11:26 PM   #28
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Re: Japan - Their 20 year Downturn and their Investors.............

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Originally Posted by wab
QQQQ is around 26 now. Typically, when a bubble collapses, P/E's go below 10. Hasn't happened to the naz (yet).

wab: Another frightening aspect of a future recession is that PE ratios may actually go up for awhile when/if the market falls, especially considering our present and future debt load: Corporate profits could stay up as stock prices dive, then as the profits start to recede and unemployment grows, the serious damage starts. No straight lines down with PEs or stock prices. It's going to be a fun ride this time--if it happens.

Everyone, I suspect, thinks the next recession will be like the last tech bubble pop: A few lost jobs and a quick recovery when the gov't floods the bond market with cash and even more cheap debt that can't be serviced properly. It may not work as well this time around, but then again it might. I'm worried that it may be different this time, and we take the rest of the world down with us.

--Greg

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Re: Japan - Their 20 year Downturn and their Investors.............
Old 10-29-2005, 04:30 AM   #29
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Re: Japan - Their 20 year Downturn and their Investors.............

My nephew has lived in Japan for nearly 10 years. Hes an English teacher in his early thirties. A few years ago he and his buddies jumped on a popular Japaneese investment bandwagon... new, single family homes in and around Scottsdale, AZ
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Re: Japan - Their 20 year Downturn and their Investors.............
Old 10-29-2005, 05:38 AM   #30
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Re: Japan - Their 20 year Downturn and their Investors.............

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Originally Posted by Apocalypse . . .um . . .SOON
wab:* Another frightening aspect of a future recession is that PE ratios may actually go up for awhile when/if the market falls, especially considering our present and future debt load:* * I'm worried that it may be different this time, and we take the rest of the world down with us.

--Greg

You worry too much.

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Re: Japan - Their 20 year Downturn and their Investors.............
Old 10-31-2005, 04:13 AM   #31
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Re: Japan - Their 20 year Downturn and their Investors.............

CT writes:
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Bpp,

Is there a good reason why the Japanese have not been buying U.S. Treasuries instead of CD'S?
Haven't been posting for a couple of days, but as others have answered, some Japanese do buy US Treasuries, as well as bonds from other countries, but there are the currency swings to be tolerated. I might add that it is fairly easy for small-fry investors to buy foreign bonds nowadays, in fact easier than it is for small-fry investors in the US to do so. I actually get my foreign bonds through my Japanese broker rather than through my US one (and I'm pretty small-fry ). So things are changing.

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