Japan Economist, Japan Macro Advisors

Takuji Okubo

Japan Economist

Concise and Insightful Analysis on Japan Economy

Japan Macro Advisors

Our mission is to provide a concise and timely analysis on the Japanese economy for the benefit of global audiences. Communication, especially in foreign languages, has always been a weakness for the Japanese, which was fine when Japan's economic might attracted foreign media and various other institutions to study and report on Japan - such days are long gone. In the last two decades, we saw foreign institutions reallocating their resources from Japan to other more exciting parts of the world. As a result, when we read reporting on Japan in foreign media, we sense a subtle but noticeable decline in the depth of understanding what is actually happening in Japan.

Macroeconomics

Wages in Japan seem to be finally on the rise. According to the preliminary wage report for March 2018, regular wages in Japan rose by 1.3% year on year (YoY), accelerating from 0.6% YoY in February and reaching the highest rate of increase since July 1997. There have been a few false dawns for a wage inflation in Japan, but the current rise may be a real one, in our view.  At 1.3% year on year, the wage inflation in March 2018 was the highest in 21 years<figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/051/758/original/jma_chart_png_400_0%20%281%29.png?1525833952" class="editor-image img-responsive" data-smartkarma-image-id="51758"></figure>Despite the relentless tightening in the…

Wages in Japan seem to be finally on the rise. According to the preliminary wage report for March 2018, regular wages in Japan rose by 1.3% year on year (YoY), accelerating from 0.6% YoY in February and reaching the highest rate of increase since July 1997. There have been a few false dawns for a wage inflation in Japan, but the current rise may be a real one, in our view.  At 1.3% year on year, the wage inflation in March 2018 was the highest in 21 yearsDespite the relentless tightening in the…

Derivatives and Quantitative Strategist

Gaudenz Schneider

Equity Bottom-Up

<ul>
<li>
Context: The <a href="https://www.smartkarma.com/entities/shimizu-corp" target="_blank" data-smartkarma-citation="entities:8530:1" rel="noopener">Shimizu Corp (1803 JP)</a> vs. <a href="https://www.smartkarma.com/entities/kajima-corp" target="_blank" data-smartkarma-citation="entities:3973:1" rel="noopener">Kajima Corp (1812 JP)</a> price ratio has deviated more than three standard deviations from its one-year average, presenting a potential relative value opportunity.</li>
<li>
Highlight: Going long <a href="https://www.smartkarma.com/entities/kajima-corp" target="_blank" data-smartkarma-citation="entities:3973:1" rel="noopener">Kajima Corp (1812 JP)</a> and short <a href="https://www.smartkarma.com/entities/shimizu-corp" target="_blank" data-smartkarma-citation="entities:8530:1" rel="noopener">Shimizu Corp (1803 JP)</a>  targets a 9% return.</li>
<li>
Why Read: Essential for quantitative traders seeking mean-reversion opportunities, with detailed execution framework, risk management protocols, and historical simulation showing the statistical basis for this relative value play.</li>
</ul>



Context: The Shimizu Corp (1803 JP) vs. Kajima Corp (1812 JP) price ratio has deviated more than three standard deviations from its one-year average, presenting a potential relative value opportunity.

Highlight: Going long Kajima Corp (1812 JP) and short Shimizu Corp (1803 JP)  targets a 9% return.

Why Read: Essential for quantitative traders seeking mean-reversion opportunities, with detailed execution framework, risk management protocols, and historical simulation showing the statistical basis for this relative value play.


Kajima (1812 JP) Vs Shimizu (1803 JP): Shimizu Earnings Jump Creates Three Sigma Dislocation

<div class="content-highlight">The opposition parties seem to be losing momentum in pursuing the responsibility of Prime Minister Abe for the cronyism scandal. However, we are seeing signs of erosion in the support for PM Abe within his party. Ultimately, the polling results would set the course, but we think it is more likely that the ruling party would decide against letting PM Abe continue as their leader when his term expires this September.  </div><h2>The testimony was a success for Prime Minister Abe</h2>The parliamentary testimony on…

The opposition parties seem to be losing momentum in pursuing the responsibility of Prime Minister Abe for the cronyism scandal. However, we are seeing signs of erosion in the support for PM Abe within his party. Ultimately, the polling results would set the course, but we think it is more likely that the ruling party would decide against letting PM Abe continue as their leader when his term expires this September.  The testimony was a success for Prime Minister AbeThe parliamentary testimony on…

PM Abe Facing Erosion of Support from His Party

Poll results reported by various media this weekend showed that the approval rate for Prime Minister Abe is falling to new lows, raising a possibility that his government will not last for long. In three out of four media polls reported on Sunday, Asahi, Mainichi, Nippon TV and Kyodo, the approval rate hit the lowest rate since the current Abe government started in late 2012.  <a href="http://www.ntv.co.jp/yoron/201803/soku-index.html" target="_blank">Nippon TV's poll</a> put the approval rate at 30.3% and the disapproval rate at 53.0%. Among media polls we have been…

Poll results reported by various media this weekend showed that the approval rate for Prime Minister Abe is falling to new lows, raising a possibility that his government will not last for long. In three out of four media polls reported on Sunday, Asahi, Mainichi, Nippon TV and Kyodo, the approval rate hit the lowest rate since the current Abe government started in late 2012.  Nippon TV's poll put the approval rate at 30.3% and the disapproval rate at 53.0%. Among media polls we have been…

Abe Government Unlikely to Last Beyond This Summer

After the landslide electoral victory in 2017, it looked certain that Prime Minister Abe would stay on for a few more years. A new development in a year-old cronyism scandal raises a possibility that he may not survive 2018 as Japan's Prime Minister. PM Abe already survived a crisis in 2017. In the earlier part of 2017, the approval rate for Prime Minister Abe plummeted as he was mired in a series of scandals. The cabinet approval rate hit a low of 34% in July 2017. However, when the largest…

After the landslide electoral victory in 2017, it looked certain that Prime Minister Abe would stay on for a few more years. A new development in a year-old cronyism scandal raises a possibility that he may not survive 2018 as Japan's Prime Minister. PM Abe already survived a crisis in 2017. In the earlier part of 2017, the approval rate for Prime Minister Abe plummeted as he was mired in a series of scandals. The cabinet approval rate hit a low of 34% in July 2017. However, when the largest…

Japan: Policy Implications from the Document-Tampering Scandal

Japan

TOPIX ETF is an Exchange-traded fund which holds a portfolio representing all stocks in the Tokyo Price Index (TOPIX).  The objective of the trust is to provide investment results that corresponds to the price and yield performance of the component securities of the Tokyo Price Index.

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Nomura ETF Topix (1306 JP)

Japan: Wages Finally on the Rise

Wages in Japan seem to be finally on the rise. According to the preliminary wage report for March 2018, regular wages in Japan rose by 1.3% year on...

Takuji Okubo

Kajima (1812 JP) Vs Shimizu (1803 JP): Shimizu Earnings Jump Creates Three Sigma Dislocation

9% target return in a potential pair trade as Shimizu’s post-earnings jump pushes the spread in this construction pair to a three-sigma extreme...

Gaudenz Schneider

PM Abe Facing Erosion of Support from His Party

The opposition parties seem to be losing momentum in pursuing the responsibility of Prime Minister Abe for the cronyism scandal. However, we are...

Takuji Okubo

Abe Government Unlikely to Last Beyond This Summer

Poll results reported by various media this weekend showed that the approval rate for Prime Minister Abe is falling to new lows, raising a...

Takuji Okubo

Japan: Policy Implications from the Document-Tampering Scandal

After the landslide electoral victory in 2017, it looked certain that Prime Minister Abe would stay on for a few more years. A new development in a...

Takuji Okubo

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