Peak Japan seems just like yesterday.
We remember the days, or daze, working as grad student interns in the U.S. G when all govie economists were studying Theory Z, a Japanese management style and all the rage in business schools during the 1980′s. That peaked on December 29, 1989, however, when the Nikkei hit its all-time of 38,957 and is now 77 percent lower almost twenty three years later.
Why do we have this gut feeling Japan and France will be the countries of focus next year? We believe the U.S. road to Greece travels first through France, the U.K., and Japan. Yikes!
The following chart also fits perfectly into the presentation Hugh Hendry gave at this year’s Economist Buttonwood Gathering. Here’s Hendry,
I go to Japan…It’s hard to believe equities and properties have fallen 80 percent over the past twenty years…The impossible is happening today in Japan. Some of the largest Japanese corporates are on the verge of bankruptcy…
Click here for that interview.
(click here if chart is not observable)