An analysis of abrupt yen appreciation and the collapse of Japanese equities, exposing speculative strategies that used Japan as a hedge while extracting massive profits—and the silence of Japanese media that refused to investigate who orchestrated the attack on the market.

2016-02-29

In a recent weekly magazine advertisement placed at the bottom of an Asahi Shimbun page, there was a headline claiming that the GPIF had suffered a massive loss of 15 trillion yen.

Those with keen insight would, from that alone, be convinced that my inference regarding who caused the sudden surge in the yen and the dramatic stock market collapse since the beginning of the year was correct.

As readers will recall, I stated that this was highly abnormal, and that the Tokyo Stock Exchange must clarify who drove the yen to such extreme appreciation while simultaneously maintaining massive short positions in Nikkei futures.

Yet Japan’s media failed to ask who targeted the Tokyo Stock Exchange—in other words, who targeted Japan itself.

Who was it that, in anticipation of a downturn in emerging markets (particularly China), engineered the climax: an abrupt yen appreciation of eleven yen in just ten days, triggering a violent collapse in Tokyo stock prices and reaping enormous profits?

In short, for more than twenty years, they had repeatedly profited by forcing Japan—arguably the world’s most stable system of governance during that period—into a cycle of yen appreciation and falling stock prices, extracting huge gains.
That is to say, they hedged in Japan, then funneled the massive profits earned there into highly unstable emerging markets, where the risks were high but the returns even higher.
What they had done repeatedly over more than two decades, they accomplished this time in barely a single month.

Yet not a single person attempted to examine this phenomenon.
Not a single media organization did so.
Only one newspaper described it as a “violent decline.”

Instead, today’s front page of the Nikkei newspaper carries the results of its own opinion poll claiming that 50 percent “do not evaluate” Abenomics.

As already noted, newspapers such as the Asahi seized the opportunity, through the news programs of their subsidiary television networks, to relentlessly criticize the Bank of Japan’s policies and the Abe administration’s economic policies day after day.

To be continued.