totally unrelated, but any chance we can get your comments on how to invest with the spectre of an invasion of Taiwan looming? Maybe it doesn't happen for another 2-3 years at which point chip supply chains are sufficiently diverse that the West isn't forced into action. Sooner than that, though, feels like we (the USA) are Japan pre-WW2 just before the US cut off their oil supply.
Russell could we see both R1 and R2? For example R2, pro labor, in China and perhaps the UK and R1 in the EU? Reason being the Euro periphery can't take a strong currency? Wouldnt R1 weaken the Euro significantly?
Regarding the exceptional nature of Japan, one must consider that it was the outlier AMONGST a world that was growing and expanding debt, globalization masket japan's problemas... untill NOW
Now the japanese broken highly indebted system can no longer hide under the umbrella of globalization... now its fate will show up, with a vengeance
Hi Russell II, great update as always. I have a related but broader question: whenever someone brings Japan to make a point on the relationship between debt, demographics, inflation and policy, I'm always wondering to what extent we can really learn from Japan since they experienced these demographic/debt trends early and therefore were "isolated" from the global trends, while now everyone is on the same boat (in addition, there was also the integration of China in the world economy happening at the time (or soon after) Japan started encountering these issues, hwhich is not going to be repeated), hence the inflation/policy outcomes might be very different? What are your thoughts on that?
I long thought Japan was "special" - but if I was going to create a nation that was the "anti-Japan", the UK would be it... weak currency, constant speculation and inflation, and strong immigration and yet UK gilts followed the trend of JGBs... so I have come round to the view that Japan is not special - but just one part of a bigger issue. I could be wrong, but this theory has some very attractive aspects to it... if its correct, politics should force Japan to change very soon
Excellent article. Someone should line up R1 and R2 to debate this on a podcast. I would predict standing room only!
Lecture by Russell Napier - Capital Management In Europe In An Age of Financial Repression - The Slow Death Of The Euro
https://www.youtube.com/watch?v=1ZE5gRiggks&ab_channel=LoM
totally unrelated, but any chance we can get your comments on how to invest with the spectre of an invasion of Taiwan looming? Maybe it doesn't happen for another 2-3 years at which point chip supply chains are sufficiently diverse that the West isn't forced into action. Sooner than that, though, feels like we (the USA) are Japan pre-WW2 just before the US cut off their oil supply.
Russell could we see both R1 and R2? For example R2, pro labor, in China and perhaps the UK and R1 in the EU? Reason being the Euro periphery can't take a strong currency? Wouldnt R1 weaken the Euro significantly?
Hey Russel,
Excellent presentation
Regarding the exceptional nature of Japan, one must consider that it was the outlier AMONGST a world that was growing and expanding debt, globalization masket japan's problemas... untill NOW
Now the japanese broken highly indebted system can no longer hide under the umbrella of globalization... now its fate will show up, with a vengeance
History is on Napier's side on this
V interesting framework. But within this mental model, was Japan running pro labour policies from 2008 --> abenomics as the yen strengthened ?
The rest of the world ran pro- capital policies in 2008 - so devalued against Japan....
Hi Russell II, great update as always. I have a related but broader question: whenever someone brings Japan to make a point on the relationship between debt, demographics, inflation and policy, I'm always wondering to what extent we can really learn from Japan since they experienced these demographic/debt trends early and therefore were "isolated" from the global trends, while now everyone is on the same boat (in addition, there was also the integration of China in the world economy happening at the time (or soon after) Japan started encountering these issues, hwhich is not going to be repeated), hence the inflation/policy outcomes might be very different? What are your thoughts on that?
I long thought Japan was "special" - but if I was going to create a nation that was the "anti-Japan", the UK would be it... weak currency, constant speculation and inflation, and strong immigration and yet UK gilts followed the trend of JGBs... so I have come round to the view that Japan is not special - but just one part of a bigger issue. I could be wrong, but this theory has some very attractive aspects to it... if its correct, politics should force Japan to change very soon
Puntastic this week
the UK is the undisputed pun kings
Is that a fiscal policy joke? :-)
Please dont make talk about UK politics!