So real cash earnings in Japan show 0% growth year on year this morning, in line with our expectations, that inflation in Japan is likely to remain flat. Once again, I would like to state my opinion that the BOJ will HAVE to revise their inflation estimates down this later this month.
With regards to the markets, Asian Equities appear to be performing well this morning and oil prices have increased, so risk aversion is not the key theme of the market (for the first time this week!). The GBPJPY has rebounded somewhat from the lows of 170.70 reached yesterday to 173.10 as the time of writing this. This really just shows how fast this pair can move in this uncertain period and there is no reason why it can not rise as quickly as it fell once this risk aversion passes.
Today’s highlight remains the US NFP. While many expect a number just north of 190K, I expect a number greater than 205K and expect unemployment to fall to 4.9%. I think that this will satisfy the FOMC that employment continues to be firm. I also believe that this firmness in the labor market will put pressure on wages and increase them and such thoughts will make the FED consider thinking about a second rate rise (perhaps in March). Let us see how it turns out.
Re the doomsayers who claim we are in recession this year:
It also appears we have many doomsayers on Etoro showing up who believe that 5 days of a good performance because they bought GOLD and JPY and shorted Equities it means that the world is going into a recession and that they are the experts on how to capitalize on it. Its kind of cute, it reminds me of all the people who thought that they could retire because they did well shorting the Euro in the first three months of 2015. Well let me say, the people following them blindly based on this are being foolish, and when you are foolish with your money, you will lose it very quickly. People in their 20’s who claim to have years experience trading and spam Etoro blindly to gather attention should not have their opinions taken as concrete just because they had a few good days. The fact remains that the last time there was a recession, many of these guys were still just entering high school and are commenting on things they have read, rather than things they have experienced. Sure they can find a few observations that match, but they are missing out on the big picture that in the developed and developing world, employment is improving. Production is Improving. Economies are Growing. Just because people have concern over them not growing as fast as expected, it does not mean recession, it means temporary panic. At the end of the day, I am sure it is flattering for these young people to think they are more enlightened than the central bank officials around the world but the truth is that this is unlikely to be the case. Had spammers like this on my wall all of last year claiming everything from recession, to the US faking results, to no rate hike etc and we all saw how that turned out. Getting a sense of Deja Vu already and can already tell you all who will be the first person to spam their site on my wall today in an attempt to shamelessly get attention.
Another random observation:
I guess my observations of the last few days have showed me why many people never achieve their financial dreams on the net and the truth is because they do not deserve to. They want everything easy and fail to even put in the slightest bit of effort. Let me give you just one example:
One of the “new” trading accounts from a UK based “trader” has profited recently and been tagging 30 currency pairs with each of their posts to promote themselves. Over 100 new people have copied them in the last 3 days, as a result. This account has 2 good months. However, the person who owns this account and has blown 5 other accounts on Etoro all in their first month, since 2015. Everyone can have a meltdown, but blowing 5 accounts in 5 months? It will likely happen a sixth time, and everyone will cry about their lost money, yet did any of them bother to even take 5 minutes to investigate things before copying blindly? Nope. They were careless with their money and that is why they are likely to fail. Come on guys, if you will not take even 5 mins to lookup something like this, how can you ever hope to take the time to learn how to trade?
Good luck today everyone,