Investment Markets Overview – 31st October 2014

The BIG news of the week wasn’t so much the confirmation from the US Federal Reserve that it’s finished its third round of QE, important that it is. It was the Bank of Japan’s board who surprised the markets on Friday by ramping up Japan’s already aggressive monetary base to Yen 80 Trillion, or $US724BN, a hefty 33% increase on the existing Y60Tr. The 70-year old B of J Governor, Haruhiko Kuroda, led a divided board to expand what was already an unprecedented large stimulus program, boosting stocks, both domestically and around the globe, whilst devaluing the yen. Ironically, being as the idea is to stimulate inflation, typical inflation bell-whethers such Gold, Oil and commodities in general, also fell. The current plan, labelled Abernomics after Japan’s Prime Minister, Shinzo Abe, was launched 19 months ago under a 3-point scheme, dubbed the “three arrows” consisting of a massive fiscal stimulus, aggressive monetary easing via the Bank of Japan and structural reforms needed to improve competitiveness. Although economic activity initially picked-up, it soon slipped back due to the weight of Government debt in Japan, put at ¥1,000,000,000,000,000,plus the necessary sales-tax increase required to service it. Hence this additional stimulus.

31 Oct 14

Subscribe to the Full Investment Markets Overview Newsletter which contains the following:-

Additional Commentaries:
•US economic data . . .
•Euro-Zone . . .
•The UK . . .
•Out East . . .
•The $US index . . .
•Within the commodities complex . . .
•Economic data due next week includes . . .

Whilst the Bank of Japan’s desperate move will see it buying $108BN of debt…….

…..

Charts:
1.Indices Weekly
2.US PCE Core V US CPI
3.UK Mortgage Lending / UK Mortgage Approvals
4.Japan Housing Starts V Japan Unemployment
5.Commodity 1 Week Moves

Table:

13 Indices, 11 columns of detailed information, for accurate analysis

It will be the markets who force the unwinding, not the Central Banks

Click Here to view Details of the full version of this Newsletter which includes full text and detailed Charts for each section

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