Bank of Japan to be top shareholder of Japan stocks
asia.nikkei.com
asia.nikkei.com
https://www.businessinsider.com/who-actually-owns-the-stock-...
Baby boomers turned 65 this year, the peak retirement there will ever be in the history of the world.
Individuals selling small amounts of stock, each for slightly below midpoint, actually has a much larger negative effect on prices than one large sale at slightly below midpoint does. Think about what the order book looks like over time.
People expect a sudden recession. The ride to the bottom is going to be a-historically long and slow, as retirement accounts unwind contractually slowly, and big institutional investors wait out lower capital gains taxes.
https://www.chicagotribune.com/business/ct-americans-dow-220...
Also, number of public companies is decreasing, with the bigger players getting bigger and bigger. And finally, I would expect even more international funds to flow in to the large conglomerates as their efficiencies of scale take over.
That is if they actually own their homes. In Japan, large potion of current working generation can't afford to own a land and house. So the real estate is not going to be the largest retirement asset for the most people in Japan.
That and the fact Japanese population is shrinking so there will be less demand for it, I'm wondering the real estate value will continue to raise like it currently is.
Japan's population is shrinking as a whole but still growing in cities (especially Tokyo). You can already get a house in the countryside for free : https://inakanoseikatsu.com/category/不動産物件/無償譲渡（0円）の空き家物件/
I think the real “string” is economic, which is the reason these houses ended up abandoned in the first place. They’re almost entirely in places with fuck all going on.
First of all, you still have to pay to the real estate agent for completing the required transaction regulation. You also have to pay tax on transaction and yearly.
Some house owner actually pay you on transaction for the hope of freeing from above yearly tax cost. They are so desperate to un-own the asset. It has practically no value yet, the tax is calculated like it had a value once upon a time.
You must also know that in Japan, you can't abandon the real estate. Once you own it, you must own it until you transfer it to the other willing to own it. It's not an asset, it's a debt, burden you for the rest of your life.
If you actually purchase these free house and pay the tax and transaction cost, it's not over. Nobody want to rent it. And you can't practically live it. If it does, it won't be sold in zero JPY.
Water, Power and Gas pipe need replacing as well as floors, walls and ceilings too.
If you repair all of these, it's actually cheaper to scrap and build a new house. It will be better by all means, it meets all the recent regulation of anti-earthquake, anti-typhoon building standard. These regulation exists because of the reasons and you don't want to live in a house that doesn't satisfy these regulation for your life.
The land itself has no value. It's located at very inconvenient places. The best case, you have to drive hours just to go to the local store. In most cases, it's located at small island so you have to use ship instead of car.
The stock markets around the world have been propped up by central banks since the financial crisis.
The FED stepped in with a few trillion in QE to save wall street. The ECB implemented their own QE. BoJ also in japan. And even china has stepped in to prop up it's stock market although their stock market is much younger, smaller and less systematically important.
And so the world goes round and round. Historically, printing money and artificially propping up assets doesn't end well, but if everyone is doing it, maybe it'll work out?
I often think the big challenge of economics now is perhaps not managing overall growth but managing sort of "decline" overall with demographic changes. If my theory is right, in 10-15 years after the baby boom generation demography will level out again and we will be back to higher growth.
The idea that GDP growth is the most important metric for the health of a society is not even wrong.
You are a quick thinker my friend. If you figure out how capitalism can work on a shrinking or even steady state economy you will get the Nobel price. No kidding.
With a non debt based currency, capitalism could do just fine in a shrinking economy no?
(Looking forward to more knowledgable people pointing out the inherent flaws in this idea.)
"There is No Steady State Economy (except at a very basic level)" http://ourfiniteworld.com/2011/02/21/there-is-no-steady-stat...
Limits to Growth–At our doorstep, but not recognized http://www.resilience.org/stories/2014-02-12/limits-to-growt...
Wealth And Energy Consumption Are Inseparable http://www.declineoftheempire.com/2012/01/wealth-and-energy-...
Galactic-Scale Energy http://physics.ucsd.edu/do-the-math/2011/07/galactic-scale-e...
It needs to be underscored that whatever this is, it isn't capitalism. Exactly which -ism it is I know not; but it is a terrible idea.
Central banks interfering in markets can only be to raise prices long-term. They aren't going to interfere to drop prices, the political pressure is unbearable over the medium term. I'l jump to the American Fed because I know a bit more about it - they haven't been able to sustain interest rate rises in my lifetime [0], there is a very clear downtrend.
This sort of activity in turn disables all the signals used to vent incompetent companies from the system. A direct result of these policies by the BoJ will be companies that take in resource, and churn out value that is less than the inputs. It is unsustainable, stupid and destructive. There are no excuses for it.
I lump the US Fed's QE programs into the same basket, but at least they muddy the waters enough that the links aren't obvious to a neutral observer. The Bank of Japan's activities are sick.
[0] https://tradingeconomics.com/united-states/interest-rate
From what I understand, the people you defend capitalism from tend to assume that those individuals themselves are less relevant than is their place in the larger system.
Does this summary of the arguments line up with your experience?
1) Most people are more involved with the famous and common 'bullshit jobs' instead of the much fewer super-productive jobs - like a couple of farmers who can feed orders of magnitude more people than just themselves. Maybe they haven't interacted with the parts of the economy that do genuine wealth-creation and don't understand it.
2) They don't accept that incentives matter more than inherent nature, so they believe the productive will continue producing even if the incentives to do so are reduced, so resources can be redirected to 'those with needs'.
The second is a pretty defensible position, although obviously I disagree most of the explicit and implicit assumptions.
As an aside, this has already become one of my fastest down-voted comments. Could someone stop by and explain what they don't like about it? I didn't think it was very inflammatory.
Can I ask why you put quotes on 'those with needs'?
I honestly don't think this will fix itself until we face great depression 2. When the government is no longer able to bail out the rich because they will have accumilated so mamy resources that nobody will be able to save them from self-imposed financial peril.
That may be true in bullshit heavy fields. When it comes to actual labor though the figure is closer to 99 in 100. Unproductive plumbers just aren't going to last very long.
Also you're getting downvotes because you're ambiguously questioning the merits of socialism. But you already knew that.
Not only are everyday people poorer but GDP is stagnant. From a western perspective the rich got a ton of raises and failed to deliver. We have countries with negative birthrates and people living in smaller homes with more food insecurity. Central Banks have been doing their best to raise prices and keep the rich afloat yet I don't see the big economic miracle.
Prehaps the source of their wealth is not productivity but good old fashioned power dynamics? What value are the rich providing to most people exactly? Wonderful new technology? That's pretty neat but what else do they have to offer?
One phenomenon that's been happening is the increasing top-heaviness of society due to automation because you simply need less people to work. The value of labour has plummeted for other reasons as well such as mass immigration and the workforce increasingly incorporating women.
The initial money to pay for stock has to come from somewhere, and that somewhere would be more debt or traditional taxes.
The federal government would control the companies (assuming it acquires majority shares), even if government employees aren't staffing them. That's socialism.
Socialism/communism is bad because if given the opportunity for direct control, government can't help tinkering in business affairs to score political points, rather than because it makes the business better.
I'm reminded of Matt Levine's running joke (?) about whether or not index funds are socialism.
There is evidence that foreign central banks are active in the US markets though [0].
[0] https://www.cmegroup.com/company/membership/files/CBIPFAQ.pd...
The ideal time for this would be once the current house of cards world economy collapses. Could be 10-15 years off yet.