Dr Andy Xie’s Insights on the Japanese Bubble

Dr Andy Xie’s insights on the Japanese Bubble are mentioned in the Australian Financial Review. Andy warns monetary policy alone cannot solve Japan’s economic growth problem, and he thinks the latest round of quantitative easing by the Bank of Japan could end in chaos. In his opinion the Bank of Japan could be blowing a big bubble…

Photo: Louise Kennerley

Photo: Louise Kennerley

What the BoJ is doing is forcing the big Japanese insurance companies and pension funds to go abroad […]

They are being screwed. With such a huge amount of funds in the Asian region the theory is they have to go to the Nikkei or US treasuries and the hedge funds are front running that. What it means is the yen will collapse like the Russian rouble in 1998. What the central bank is doing is they can’t see the end game, but the end game is chaos.

Japanese people have a bubble once every 50 years. It’s not like Chinese people, they have a bubble every 10 months, but once Japan does have a bubble they do it really big.

Read the entire article here

Dr Andy Xie 謝國忠 is a Shanghai-based independent economist specialising in China and Asia. He is currently director of Rosetta Stone Advisors and of China Boqi Environmental Science and Technology.  He is also a guest columnist for the South China Morning Post and New Century Weekly.

Dr Xie is one of the few economists who has accurately predicted economic bubbles including the 1997 Asian Financial Crisis and the more recent subprime meltdown in the United States. He joined Morgan Stanley in 1997 and was Managing Director and Head of the firm’s Asia/Pacific economics team until 2006. Prior to that he spent two years with Macquarie Bank in Singapore, where he was an associate director in corporate finance. He also spent five years as an economist with the World Bank.

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