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Your guide to what US elections in 2024 mean for Washington and the world
Last week, he said that the manager of one brokerage trading in Tokyo was not sure what they saw. Donald Trump was really about tariffs or was it a brinkmanship? Would there be a sudden rash that caused it all to disappear? Was it the end of the global trading system?
“After the weekend, when you saw China's retaliation, Trump kicked with the statement that he was” medicine “and no agreements on offer for very American nations like Japan came on Monday for sure it was bad and for real,” Tokyo shares were released by more than 9 percent.
Probably the most worrying aspect of Monday's sale in Tokyo and Asia, said analysts were more rational than panically affected.
Perhaps even more worrying for those who wondered if the relief could suddenly come from the White House, the view of the Dow Jones index has been since the beginning of Trump's first Presidency in 2017: it is more than 90 percent even after the last week, one broker. “Do they think markets can take much more pain if they are in black -in -class lessons?”
The weekend had market participants consider the consequences of not only tariffs, but also the possible global recession and flood of cheap, redirected Chinese goods to markets outside the US. This could cause deflationary tsunami and central banks would have a limited ability to detain damage.
Especially for Japan, this set of concerns also raises huge doubts about the ability of the central bank to raise rates and normalize monetary policy.
Extreme Rukce in Tokyo – Fooling stocks, decreasing bond yields and huge volatility in Jen – encapsulate the difficulty that now faces investors across asset classes. As many traders said, most of the global riots have been powered by shorter money. Markets still did not feel the impact of what could be much greater rotation of the risk of global long -term funds.
As one of the assets based in Tokyo said, it is difficult to think about the time when the situation represented such binary results, with such little visibility on both sides. The markets are now properly determined that no one speaks for Trump except Trump, “which reduces your universe of market resources per person”.
“If tariffs are at these levels,” added the manager, “it is not too late to sell shares. If tariffs are unfold, it is the mother of all reflections. Getting placement for two results at a completely different end of the spectrum is very, very, very difficult.”
For many years, Tokyo Equity Brokers said, DIPS purchase strategy worked well. The moments of riots were a direct opportunity for many. There has been perception, again and again, according to the experience that recovery eventually comes and all the risk will consist of missing reflection.
Suddenly, the concerns that Trump's steps have now been changed to make this strategy in doubt: there may be shops to be carried out above tariffs, but Japan shows how high the bar was set up. Japan is the closest ally of America in Asia and the largest direct investor in the US. It is now listed among the “peel” of America and has not been able to ensure any relief from “daily day” of 24 percent.
In fact, Prime Minister Shiger Ishiba admitted Parliament on Monday that Japanese salvation could consist of the best of customs relief, but to prepare for the worst through a domestic complaint.
If he is right, investors around the world have much more relocated.
