Abenomics is nothing new

Synopsis

In Tokyo, John Arthur discusses the excitement among International investors regarding Prime Minister Shinzo Abe's efforts to reflate Japan's economy. Yasari Ueno, the chief markets Economist at Mahor Securities, expresses skepticism about Abenomics, highlighting that it is a revival of past economic policies. Ueno points out that Japan has previously implemented massive fiscal expenditures in the 1990s and quantitative easing from 2001 to 2006, but these strategies lacked strong initiatives. He notes the rising yields in the Government Bond Market, contrary to Abe's intentions to lower borrowing costs. Ueno emphasizes that the market is fragile, with high volatility and dependency on the Bank of Japan's operations, leading to a weak buying power in the bond market. This situation raises concerns about the effectiveness of Abenomics and its potential risks for the Japanese economy.