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Stansberry Research’s Steve Sjuggerud on the Japanese Stocks’ Fate

Stansberry Research was established as an autonomous firm that engages in investment research. The founder of Stansberry Research, Frank Porter Stansberry, writes pieces of opinions that discuss issues covering the auto bailout, the European financial panic, etc. Steve Sjuggerud is the editor and founder of the Stansberry Research True Wealth publication, which started in 2011.


In November 2016, Steve Sjuggerud commented that the Japanese stocks were “one-way-bet”, which means that Japanese stock investors cannot expect that the said stocks will get any better.; and during that time the policymakers of Japan were concerned that a deflation is about to happen in their country.


To avoid the looming situation, the central bank of Japan – Japan Bank, gave a guarantee that it would propel the inflation higher at whatever cost. To make it short, the Bank of Japan became more determined its past stimulus campaign by reducing interest rates more and increasing its huge measurable easing plans. The Bank assured everyone concern that it will carry on with its efforts for an indefinite period until such time that inflation rises over its longstanding 2% objective.


The regular subscribers of the Digest would remember that Steve Sjuggerud considered that the move would provide an enormous boost for the Japanese stocks. Thus by far, he was correct since the Japanese stocks have risen 20% from that time.


However, on March 9, 2018 (Friday), Haruhiko Kuroda (Governor of the Bank of Japan) stated that they would be winding-up the Bank’s vast stimulus program – as per a report made by Bloomberg. In his statement, Governor Kuroda said that he and the policy board members deem that prices will increase and reach the 2% target by 2019. And considering this it is just but rational to end the program at that same time.


Although Governor Kuroda did not state that the bank will actually end its stimulus program at on the cited time. And despite the announcement, the Japanese yen further increased and the Nikkei 225 Index lurched to almost 3%.


Based on the announcement of Kuroda, Steve Sjuggerud opined that investors can still safely invest and trade Japanese since the Bank of Japan does not merely want to reach the 2% target but would want to overshoot it, which would not happen in 2019.