Tuesday, December 9, 2014

Kanin-abe Chao Ji Bai! The Slow Death of Japan

That is Kuroda, laughing at yours (and my) Saizen and Croesus holdings. Lolz.

Japan is the undisputed reigning multi-year global heavyweight champion in engaging in the most retarded economic policies of our recent human history.

Their currency is imploding every day as we speak. Don't be fooled by the soaring Nikkei. A soaring stock market means nothing without context. Ask Venezuela. 300% returns in 1 year, that's totally normal, right?

I have written about Japan before, I believe they are completely batshit crazy:
Japan knows it cannot afford deflation with all its debt. Deflation is good for lenders, bad for borrowers. Inflation is good for borrowers, and they are huge ones, so they are going all out to force out inflation.


They are crazy, driving their currency and economy straight into the ground. More currency doesn't make people actually richer (delusions and feelings though, that's another issue), only an increase to the actual goods and services that can be consumed will. Shit, what kind of dumbshit economics are they teaching in Japan? Unless policy makers know that all they are doing is forcibly stroking people to think they are richer (which people aren't buying it because they are not), they are digging themselves deeper down their already very deep hole.
GMGH, 31 Oct 2014 
Stupid countries with dumbshit policies come and go all the time. However, in recent times with less political turmoil, countries hands have been tied so that are actually limited in the amount of stupid mistakes they can make to screw up their own country. Japan has been performing outstanding well at the suicide of their country, although Venezuela is doing a fantastic job as well. There's no better way to get onto the fast-track of country suicide by adopting extreme socialism. USA and the whole EU, not wanting to lose out in anything, are trying their best to catch-up.

On the very hopeful bright side, Saizen and Croesus are hard asset companies. And they are leveraged, ie. borrowers. If an inflation tsunami really hits, fantastic for them. The only problem is just a time-lag to adjust rentals for inflation, which I can just write off as half a year of loss revenue. The medium term is not very worrying. I wouldn't touch anything else in Japan right now. Radiation.

However, in the long term, at this rate, these investments will most probably not work out. Japan is going the ways of other indigenous island communities who stubbornly refuse to let go of their roots, resist the forces of globalization and have delusional leaders. In 50 years time, no one will learn Japanese anymore. Japanese cuisine and anime will be the only remaining exports to remind the world of a country that used to be great. You can probably go and squat in empty houses in the rural areas for free pretty soon. Just read an article about a town with more scarecrows than people. It's both sad and funny because it's completely true.

Okay, I'm just being extremely negative here. I don't really think it will be THAT bad. But it will be bad. Like seriously. I think this is a perfect example for Singapore to know what we SHOULD NOT do in the future.


  1. Hi GMGH,

    I hold Saizen REIT and I can feel the loss. It's surprising that the baby gets thrown out with the bath water.

    In all honesty, I'm not too worried about my holding. Japanese families still need to live, work and play. A (rented) shelter over their heads is still a basic necessity. I do not think the fundamentals have changed significantly.

    1. Heya S-Reit System Investor,

      I totally agree with you, the fundamentals look pretty much the same in yen terms. They are hedged out until June 2015, so I don't know what is causing the jitters. Honestly, I feel very tempted to accumulate more, haha!


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