For the next few days I will be resting, hoping to enjoy some peace before the potential storms that face the financial markets at the end of 2014. Now that the Japanese election has been decided there is certain to be great volatility in all Japanese investments as polls get released and money becomes nervous. It seems that Prime Minister Abe is trying to solidify his hold on the LDP by going directly to the people. In an effort to gain the voters support Abe has decided to delay the scheduled sales tax increase and also announced a corporate tax cut. The game for Abe is to get public support to overcome the fiscal hawks that the prime minister believes are stalling the economy and preventing the completion of Abenomics and the “three arrow agenda.” The stalwarts of the LDP will be defeated by an overwhelming ABE victory.
Posts Tagged ‘LDP’
Notes From Underground: A Short Hiatus Before Year-End Volatility Rises
November 18, 2014Notes From Underground: Shinzo Abe to the American People … Now This Is A Mandate
December 16, 2012The Japanese LDP and its partner the New Komeito Party have seemingly captured more than the 320 seats needed to override the upper-house on most legislation. The two-thirds majority garnered by the ABE COALITION will give the LDP enough power to put pressure on the BOJ to attempt an effort to end the deflation that has encumbered the Japanese economy. The campaign issues promoted by the victorious coalition should lead to further weakening of the YEN although we may see a bout of profit taking as the rumor has become fact. Mr. Abe had promoted the ending of BOJ independence but it is doubtful that promise will be realized. The overall response to the end of central bank independence may unleash a response bigger than the LDP will want to confront. The global financial world have become very supportive of central banks being independent of government control and it seems more likely that PM Abe can influence policy in other ways.