Posts Tagged ‘Japan’


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FT.com – Commodities News and Market Data
April 06, 2011

ETFs linked to the coal industry have seen an upsurge in interest following the crisis at the Fukushima nuclear plant in Japan and flooding in Queensland which has disrupted coal production in Australia.


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>below are some excerpts from Jim Rogers interview:

Dollar will be debased; gold and silver to hit new highs

Chinese economy:

There is some overheating and inflation

setback in urban, coastal real estate is under way

China has been overbuilding ever since I have been visiting. There is at least eventual demand for much of it, but that does not preclude some bankruptcies in the future.

Europe:

I think we are getting closer and closer to the point where someone in Europe is going to have to take some losses, whether it's the banks or the countries, but somebody has to acknowledge that they are bankrupt.

Following is an interview that The Daily Bell had with Jim Rogers:

Jim Rogers: Dollar will be debased; gold and silver to hit new highs
05 April 2011 | http://www.commodityonline.com

Daily Bell: We've interviewed you before. Thanks for spending some time with us once again. Let's jump right in. What do you think of the Chinese economy these days?

Jim Rogers: There is some overheating and inflation, which they are wisely trying to cool – especially in urban, coastal real estate. They have huge reserves so will suffer less than others in any coming downturn.

Daily Bell: Is price inflation more or less of a problem?

Jim Rogers: More. At least they acknowledge inflation and are attacking it. Some countries still try denying there is inflation worldwide. The US is even pouring gasoline on these inflationary trends with more money printing instead of trying to extinguish the problem.

Daily Bell: Is China headed for a setback as you suggested last time we spoke?

Jim Rogers: Did I say a setback or a setback in real estate speculation? I think you will find it was the latter. Yes, the setback in urban, coastal real estate is under way.

Daily Bell: They are allowing the yuan to float upward. Good move?

Jim Rogers: Yes, but I would make it freely convertible faster than they are.

Daily Bell: Will that squeeze price inflation?

Jim Rogers: It will help.

Daily Bell: Why so many empty cities and malls in China? Does the government have plans to move rural folk into cities en masse?

Jim Rogers: That is a bit exaggerated. China has been overbuilding ever since I have been visiting. There is at least eventual demand for much of it, but that does not preclude some bankruptcies in the future.

Daily Bell: Is such centralized planning good for the economy?

Jim Rogers: No. Centralized planning is rarely, if ever, good for the economy. But the kind of construction you are describing is at the provincial level – not the national level.

Daily Bell: The Chinese government is worried about unrest given what is occurring in the Middle East. Should they be?

Jim Rogers: We all should be. There is going to be more social unrest worldwide including the US. More governments will fall. More countries will fail.

Daily Bell: Are they still on track to be the world's biggest economy over the next decade?

Jim Rogers: Perhaps not that soon, but eventually.

Daily Bell: Any thoughts on Japan? Why haven't they been able to get the economy moving after 30 years? Will the earthquake finally jump-start the economy or is that an erroneous application of the broken-windows fallacy?

Jim Rogers: It has been 20 years. They refused to let people fail and go bankrupt. They constantly propped up zombie companies. The earthquake will help some sectors for a while, but there are serious demographic and debt problems down the road.

Daily Bell: The Japanese were going to buy PIGS bonds. What will happen now? Does that only leave China?

Jim Rogers: Obviously the Japanese have other things on their mind right now. I think we are getting closer and closer to the point where someone in Europe is going to have to take some losses, whether it's the banks or the countries, but somebody has to acknowledge that they are bankrupt. The thing that the world needs is for somebody to acknowledge reality and start taking haircuts.

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Tokyo with the dimmer switch on

By Tyler Brûlé
FT.com / Life & Arts –

Published: March 18 2011 17:19 | Last updated: March 18 2011 17:19

This isn’t the column I wanted to write this week – or ever. It’s late Thursday afternoon in Tokyo, I’m sitting in the JAL lounge at Haneda airport and I’ll soon board a Cathay Pacific flight for Hong Kong and then carry on to Milan. The airport isn’t chaotic, the queues aren’t anything out of the ordinary and I really don’t want to go. I was originally supposed to fly on Friday but all the flight changes forced an early departure and I’m staring out across the bay to Tokyo and taking stock of the past few days.
I arrived in Tokyo on Tuesday. The 4.35pm ANA flight from Seoul’s Gimpo airport to Tokyo Haneda usually operates at close to 100 per cent capacity – with business class frequently wait-listed. When I walked up to the counter at Gimpo on Tuesday afternoon, there wasn’t a passenger in sight in the ANA check-in zone and as I approached the desk a manager eagerly popped out from behind to assist his staff with the check-in procedure. While boarding passes and bag tags were being printed, I asked how full the flight was. For a brief moment he instinctively smiled and then shifted his lips to a frown and said flight NH1164 was “empty”.
For the better part of 96 hours I’d been corresponding with staff in our Tokyo office to gauge their moods while also monitoring the behaviour of the five London-based colleagues with me in Seoul. Originally, four of us were due to travel on to Tokyo but by mid-afternoon on Monday a photo-shoot scheduled for Wednesday had been shelved, there were frequent questions about the necessity for the trip by others, the Tokyo team was continuously updating and assessing the viability of the schedule, and all along I was getting a strong sense that my cohorts weren’t keen on making the trip to Japan. Between meetings I took the opportunity to fire off a quick e-mail explaining the situation and advised that anyone uncomfortable about travelling to Japan could return to London but that we also had a moral and professional responsibility to support our colleagues in Japan if they were still going about their normal business and working as usual. By the time I reached the gate, I was alone.

Read the rest here: FT.com / Life & Arts – Tokyo with the dimmer switch on

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>Oh, poor “Demonized Algos” !!!

Demonised ‘algos’ push the surge in FX trading

By Jennifer Hughes, Senior Markets Correspondent
Published: September 1 2010 00:04 | Last updated: September 1 2010 00:04

Since the infamous stock market “flash crash” of May 6, high-frequency, or algorithmic, trading has been unwillingly dragged into the political and regulatory limelight.
forex-trading-graphicSo far, however, attention has focused on the role of these high-speed traders in the equity market. Outside the glare of that publicity, it is less well known that on May 7, FX trading volumes reached records, straining the plumbing of these markets.
Some participants argue these strains were partially caused by algorithmic, or algo, traders.
Exactly how much of this can be attributed to algo trading is unclear. However, there is no question that high-frequency traders are a fast-increasing force in FX markets, which is sparking a fierce debate as to their value to the market.
On Tuesday, the Bank for International Settlements reported that average daily turnover in the FX market has jumped 20 per cent in the past three years to $4,000bn a day. Its survey was taken in April, so missed the May spike, which related to the eurozone sovereign debt crisis.
The BIS-reported gains were led by a near 50 per cent leap in spot trading – deals for immediate delivery – to $1,500bn a day. This jump was powered by increased activity from “other financial institutions”, a group that includes hedge funds, pension funds, some banks, mutual funds, insurance companies and central banks. This will also include algos.
While all categories of “other” could have increased their trading, it is likely a significant proportion was driven by algo traders, who favour the deep, liquid spot markets and particularly currency pairs such as eurodollar and dollar-yen, which between them account for 42 per cent of all currency trading.
The question for the FX market is whether high-frequency dealers improve the market by adding liquidity, or whether they are instead merely price takers who contribute little.
“Algos have been demonised, but they’re an important part of the growth story,” says David Rutter chief executive of Icap Electronic Broking, which runs EBS, the main FX interbank trading platform. “What we’ve found is that they add pressure at each price point so that instead of getting big price gaps on shocking news, trade is more orderly.
“With FX, there are a lot of other flows such as global trade, so there is good underlying liquidity that the algos can enhance.”
Algos initially appeared in FX markets almost a decade ago, attracted by the deep liquidity and increasing use of electronic trading. They were generally welcomed, particularly by banks looking to build their prime brokerage businesses. However many banks soon grew disenchanted when they found the fast-moving shops were profiting from banks’ own slow systems by exploiting brief, tiny price differences between rival platforms.
Some banks went as far as ejecting offenders from their platforms but banks’ views have since become more nuanced. They have generally reached an accommodation, helped by technological improvements which make it easier to monitor client dealings and offer client-specific prices.
“The facts are that algos have made the markets more efficient and have helped ensure there’s one virtual price,” says Jeff Feig, global head of G10 FX at Citigroup. “They do cause banks to be smarter and we’ve had to work harder to be more efficient, but that’s ultimately to the advantage of the end user.
“I think that to some extent, algos have pushed banks and the result has been enhanced transparency and increased liquidity.”
Algos mean many different things in the FX market. While high-frequency traders are the best known – typified by one senior banker as “five smart guys in a room in New Jersey,” – banks are increasingly adept at developing their own algorithms to make their internal FX deals more efficient. These “internalisation” trades too will have provided a boost to the BIS numbers.
Most players say algos are now a fact of life in currency markets.
Unlike the equity market, which is split into hundreds of stocks, they believe the FX world’s focus on a relatively small number of currency pairs means it would be far harder for a single group of participants to move the market significantly, intentionally or otherwise, as some watchers fear happened during the “flash crash”.
“Also trading can happen anywhere there’s an electronic execution system and a volatile market,” says Alan Bozian a former FX banker and now chief executive of CLS Bank, the FX settlement system. “The question is, which markets adapt well and I don’t think it’s necessarily the stock market.”
FX markets have proved generally good at adapting. Systems such as CLS, introduced years before the financial crisis, have helped minimise settlement risk and since May, participants have been working again to improve their processing systems to cope with increased volume.
Significantly, for a market that is very much built around a hub of big banks, the BIS report showed that, for the first time, interaction of the main banks with “other” financial institutions overtook trading between themselves.
This could be a pointer to the market of the future, where banks are likely to remain the hub, but as much for their trade processing abilities as for their liquidity.
This would allow the winners to build profitable volume without taking on huge trading risks – suiting the current regulatory mood.
“The banks want to continue being the price providers, but they’re getting much more interested in the infrastructure and improving that,” says Mr Bozian. This evolution is likely to apply to high-frequency trading too.
Mr Rutter believes algos are only in their “late teens” in terms of development. “The early algo trading was about super-fast dealing and chasing inefficiencies. That’s largely gone,” he says.
“Now its about math and science being thrown at the market – there’s a rich pool of data and I think we’ll see algos evolve so its not just about milliseconds, but about longer-term predictive math.”

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Shrinking Societies: The Other Population Crisis

The earth’s population is growing at an alarming rate, but in some countries the lack of growth is the biggest problem

A Japanese woman’s role in society is to give birth, and “all we can do is ask them to do their best per head,” said Hakuo Yanagisawa, Japan’s former health minister. His remark, as reported by Bloomberg in 2007, drew criticism for being sexist, but it touches on one of Japan’s most pressing issues: its rapidly aging and shrinking population.
Japan is expected to see its population contract by one-fourth to 95.2 million by 2050, according to the Population Reference Bureau, a Washington-based research group, making it the fastest-shrinking country in the world.Former Eastern Bloc nations Ukraine and Georgia came in second and third, respectively, in a ranking of more than 200 countries by Businessweek.com based on the Population Reference Bureau’s 2010 World Population Data Sheet.
These countries defy the global trend—but that doesn’t mean they’ll be spared problems of their own. The world population is expected to expand by 37 percent to 9.5 billion in 2050, according to the report, but growth will not be evenly distributed. Developing countries will grow the most, with the population in Africa expected to double.
Meanwhile, other regions will shrink as the boomer generation ages, people have fewer children, and workers leave for opportunities abroad. The most widespread decline is projected in Eastern Europe, where birthrates have declined since the breakup of the Soviet Union. The number of people in every country in the region, except the Czech Republic, is forecast to contract. By 2050 the region will have lost 13.6 percent of its population, according to data from the Population Reference Bureau.
“Europe, Korea, and Japan have gone into panic mode,” says Carl Haub, a senior demographer at the Population Reference Bureau. A declining population impacts a country’s economic growth, labor market, pensions, taxation, health care, and housing, according to the U.N. Globally by 2050, the number of older persons in the world will exceed the number of young for the first time in history, according to the U.N. The imbalance will create havoc in the pension systems and make it difficult to support retired and elderly persons, Haub says.
Despite these economic and social consequences, there have been no easy long-term solutions for countries trying to reverse this trend. “Demographic changes are pretty glacial,” says Haub.

Incentivizing Growth

That does not mean governments are not trying. Many countries are on a mission to raise the number of births. Although migration patterns affect many countries—such as Lithuania, where the number of people leaving the country is several times the number entering it—they change quickly and can be difficult to project.
Japan’s fertility rate fell from 1.57 children per woman in 1989 to 1.26 in 2005, according to Haub. It has rebounded to 1.4, but remains below the rate needed to replace the population: 2.
To encourage people to have more children, the government started implementing a series of programs called “Angel Plans” in 1994, says Toshiko Kaneda, senior research associate at the Population Reference Bureau. The plan offers counseling to couples, increases child-care services, and provides a monthly stipend of 26,000 yen (approximately $303) per child to ease the burden of raising a family.
In Germany, where the fertility rate is 1.3, the government pledged to increase the number of nursery schools and introduced an allowance that pays 67 percent of a parent’s income for the first year after a child is born if he or she stays home.
Even in Iran, where the fertility rate is 1.8, President Mahmoud Ahmadinejad recently introduced a policy that pays families for every child born and deposits money into the child’s bank account until he or she is 18.
Such policies only have moderate success, says Dimiter Philipov, a research group leader at the Vienna Institute of Demography in the Austrian Academy of Sciences. As subsidies mainly cause people to have children earlier, the number of births typically increases in the first few years after a policy is passed. The allowances are much lower than the amount needed to raise a child, but “this is a success because it brings in more babies and makes population changes smoother,” he says.
Also, while declining fertility was once attributed to the falling marriage rate, today the deteriorating job environment also affects people’s decisions to have children, according to NLI Research Institute in Japan. Thus, in developed countries, rather than offer financial incentives, Philipov says, it is more effective to relieve pressure on parents through child-care services and ensuring job security for mothers. “Some would say no one has done it better than France,” where there is a broad menu of services for women and parents, says Haub.

Ideal Fertility Rate

Some argue the need to boost the fertility rate might not be so urgent. Tomáš Sobotka, a research scientist at the Vienna Institute of Demography, wrote in February in a column for The Guardian in the U.K. that demographers have been envisioning the demise of Europe since birthrates in the region began declining in the late 19th century, but “it is not population size but affluence and technology that make some countries more powerful than others.”
Philipov says a debate has emerged about the ideal fertility rate. Advances in science and technology that boost productivity might compensate for a fertility rate below the replacement level, such as 1.7 to 1.8, he says.
Still, a fertility rate of 1.4 or 1.5, as seen in many countries, is “too low,” Philipov says. At that level, the number of entries into the labor force becomes too narrow, making it difficult to support pensioners and children.

Elder Care

As fewer children are born, the fastest-growing age group in the world is people age 80 and older, according to the U.N. In 2000, there were about 4 people over age 85 for every 100 people ages 50 to 64; by 2050, it will rise to 11.
The situation is more dire in places such as Japan, where the Population Reference Bureau predicts there will only be one working-age person for every person over age 65 in 2050. Already, there are long waiting lists at nursing homes in Japan’s cities. To meet demand, the government has been recruiting, testing, and training nurses from Indonesia and the Philippines.
Also, new technologies are being introduced in Japan to serve the elderly, although they are no substitute for people. For example, companies have reportedly been designing robot caretakers, devices for remote medical care, and cars that monitor brain activity to assist older drivers.
Over the next 40 years, the age pyramid will be upside down and technological advancements will only provide limited relief. While demographic trends are difficult to change, Haub says, “something will have to happen.”
Click here to see the 25 countries with the fastest-shrinking populations.

Wong is a lifestyle and real estate reporter for Bloomberg Businessweek.

Shrinking Societies: The Other Population Crisis – BusinessWeek

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“Living until 150 years old is impossible in the natural world,” said Akira Nemoto, director of the elderly services section of the Adachi ward office. “But it is not impossible in the world of Japanese public administration.”

Seems like the Japanese like a little pension fraud as well….

Japan, Checking on Its Oldest, Finds Many Gone

TOKYO — Japan has long boasted of having many of the world’s oldest people — testament, many here say, to a society with a superior diet and a commitment to its elderly that is unrivaled in the West.
That was before the police found the body of a man thought to be one of Japan’s oldest, at 111 years, mummified in his bed, dead for more than three decades. His daughter, now 81, hid his death to continue collecting his monthly pension payments, the police said.
Alarmed, local governments began sending teams to check on other elderly residents. What they found so far has been anything but encouraging.
A woman thought to be Tokyo’s oldest, who would be 113, was last seen in the 1980s. Another woman, who would be the oldest in the world at 125, is also missing, and probably has been for a long time. When city officials tried to visit her at her registered address, they discovered that the site had been turned into a city park, in 1981.
To date, the authorities have been unable to find more than 281 Japanese who had been listed in records as 100 years old or older. Facing a growing public outcry, the country’s health minister, Akira Nagatsuma, said officials would meet with every person listed as 110 or older to verify that they are alive; Tokyo officials made the same promise for the 3,000 or so residents listed as 100 and up.
The national hand-wringing over the revelations has reached such proportions that the rising toll of people missing has merited daily, and mournful, media coverage. “Is this the reality of a longevity nation?” lamented an editorial last week in The Mainichi newspaper, one of Japan’s biggest dailies.
Among those who officials have confirmed is alive: a 113-year-old woman in the southern prefecture of Saga believed to be the country’s oldest person, at least for now.
The soul-searching over the missing old people has hit this rapidly graying country — and tested its sense of self — when it is already grappling with overburdened care facilities for the elderly, criminal schemes that prey on them and the nearly daily discovery of old people who have died alone in their homes.
For the moment, there are no clear answers about what happened to most of the missing centenarians. Is the country witnessing the results of pension fraud on a large scale, or, as most officials maintain, was most of the problem a result of sloppy record keeping? Or was the whole sordid affair, as the gloomiest commentators here are saying, a reflection of disintegrating family ties, as an indifferent younger generation lets its elders drift away into obscurity?
“This is a type of abandonment, through disinterest,” said Hiroshi Takahashi, a professor at the International University of Health and Welfare in Tokyo. “Now we see the reality of aging in a more urbanized society where communal bonds are deteriorating.”
Officials here tend to play down the psychosocial explanations. While some older people may have simply moved into care facilities, they say, there is a growing suspicion that, as in the case of the mummified corpse, many may already have died.
Officials in the Adachi ward of Tokyo, where the body was found, said they grew suspicious after trying to pay a visit to the man, Sogen Kato. (They were visiting him because the man previously thought to be Tokyo’s oldest had died and they wished to congratulate Mr. Kato on his new status.)
They said his daughter gave conflicting excuses, saying at first that he did not want to meet them, and then that he was elsewhere in Japan giving Buddhist sermons. The police moved in after a granddaughter, who also shared the house, admitted that Mr. Kato had not emerged from his bedroom since about 1978.
In a more typical case that took place just blocks from the Mr. Kato’s house, relatives of a man listed as 103 years old said he had left home 38 years ago and never returned. The man’s son, now 73, told officials that he continued to collect his father’s pension “in case he returned one day.”
“No one really suspects foul play in these cases,” said Manabu Hajikano, director of Adachi’s resident registration section. “But it is still a crime if you fail to report a disappearance or death in order to collect pension money.”
Some health experts say these cases reflect strains in a society that expects children to care for their parents, instead of placing them in care facilities. They point out that longer life spans mean that children are called upon to take care of their elderly parents at a time when the children are reaching their 70s and are possibly in need of care themselves.
In at least some of the cases, local officials have said, an aged parent disappeared after leaving home under murky circumstances. Experts say that the parents appeared to have suffered from dementia or some other condition that made their care too demanding, and the overburdened family members simply gave up, failing to chase after the elderly people or report their disappearance to the police.
While the authorities have turned up a large number of missing centenarians, demographic experts say they doubt that discoveries of the living or the dead would have much impact on Japan’s vaunted life expectancy figures; the country has the world’s highest life expectancy — nearly 83 years — according to the World Bank. But officials admit that Japan may have far fewer centenarians than it thought.
“Living until 150 years old is impossible in the natural world,” said Akira Nemoto, director of the elderly services section of the Adachi ward office. “But it is not impossible in the world of Japanese public administration.”

Japan, Checking on Its Oldest, Finds Many Gone – NYTimes.com

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