"Everything has been said before, but since nobody listens we have to keep going back and beginning all over again." -Andre Gide
Japan is all that matter right now.
Greetings!
It seems many have come to accept the macro environment we'll face for many quarters, if not years, to come. Central banks have firmly planted their policies into the market and they won't be uprooting them anytime soon.
The only hiccups will come if the market says so.
And the market may say so only if unprecedented policy breeds instability, tangible unintended consequences.
We've talked before about how emerging markets tend to see this instability arise in their economies since their central banks cannot keep pace with developed-market central banks, and their capital markets cannot absorb policy measures the same way more developed capital markets can.
But it seems there may be some risk of instability in a major economy where the central bank has committed itself to making monetary policy the answer.
That economy is Japan ...
Currency Currents 24 May 2013
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