Yen is cheap. In every possible way I look at currencies - Yen comes up as cheap. Using BIS data on real effective terms it is back at 1970s levels.
I also know two very successful fund managers who are openly long Yen. And they get very little push back on this view. The problem with this view is that it reminds me so much of the bearish JGB views I heard back in the 1990s. It made logical sense but was totally wrong. Yields on JGBs fell from 4% to 0% eventually.
What could cause a long Yen view to be wrong?
