Tag Archives: Haruhiko Kuroda

Earnings Season Kicks Off, Bernanke's Speech, and Today's Other Major Financial Stories

By John Maxfield, The Motley Fool

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1. Earnings season kicks off

First-quarter earnings season unofficially kicks off today with

reporting after the close. The outlook this quarter has been particularly weak. According to Thompson Reuters, earnings at
S&P 500
companies are set to increase by only 1% compared to 6.2% in the fourth quarter of last year — analysts
surveyed by Bloomberg
estimate that the figure will fall 1.8%. Additionally,
data and analysis
from FactSet shows that 86 companies have issued negative guidance, versus 24 that have issued positive earnings guidance.

In terms of bank stocks, JPMorgan Chase and Wells Fargo both report on April 12, followed by Citigroup on the 15th, and Bank of America on the 17th.

2. Bernanke speaks after the bell
The chairman of the Federal Reserve, Ben Bernanke, is set to speak after the markets close today. Given the particularly abysmal jobs report last week, many are expecting him to continue pushing the central bank’s aggressive monetary stance, under which it’s purchasing $85 billion in treasuries and agency mortgage-backed securities a month.

3. Japan’s central bank has sparked a rally
Speaking of central banks, the Bank of Japan sparked a massive rally in Japanese stocks. The country’s most closely followed index, the Nikkea 225, is at a nearly five-year high, increasing by 46% over the last six months alone. The Yen is also well on its way to a five-year low relative to the dollar. After trading below 80 to the dollar for much of last year, it’s on the verge of breaking the 100 benchmark. As The Wall Street Journal noted, “The new and (as far the market and Japanese exporters are concerned) improved Bank of Japan under the leadership of Haruhiko Kuroda took a page from the Fed’s ‘shock and awe’ playbook, unveiling a bond-buying program that was far larger than anybody expected; in some quarters, it’s being called QQE.”

4. Bank of America seeks to woo customers
The nation’s second largest bank is rolling out a new advertising campaign in conjunction with the NCAA college basketball tournament. It’s designed to be a more humble approach. “We are a facilitator,” a Bank of America marketing executive said. “It’s not about us. We need to focus on customer needs first and we know our place. We know we’re not the center of your life, but we will connect you to what it is.” The move comes on …read more

Source: FULL ARTICLE at DailyFinance

Asia's Week: Kuroda Speaks Louder Than Kim

By Tim Ferguson, Forbes Staff

Chevrolet Code 130R concept - front three-quarter view

Asia’s action really picked up in April as the electoral ground began to shake in Malaysia, President Thein Sein sought to calm the troubled sectarian waters of Burma/Myanmar and the spectre of bird flu grew more ominous in southeastern China. But, even more prominent than those developments, two aggressive players in North Asia sought to achieve shock and awe: North Korean dictator Kim Jong-eun and Japanese central banker Haruhiko Kuroda. …read more

Source: FULL ARTICLE at Forbes Latest

Is the Bank of Japan Really Easing — or Does It Just Want to Depreciate the Yen?

By Eamonn Fingleton, Contributor

Big news! The Bank of Japan is set to double Japan’s money supply – or at least that is what Bank of Japan governor Haruhiko Kuroda is currently saying. I have to enter this caveat because as a veteran of 27 years of Japan watching from a base in Tokyo, I have long since become rather skeptical of statements from the Bank of Japan and other key Japanese government agencies. Allegedly momentous developments come with increasing regularity and then seem to be reversed within months, if not weeks. …read more

Source: FULL ARTICLE at Forbes Latest

Japan's Money-Printing Frenzy and Today's Other Important Financial Stories

By John Maxfield, The Motley Fool

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After a rough day yesterday, financial stocks are generally higher this morning. The financial stories below help to explain why.

1. Bank of Japan: Let the printing begin!
What’s the best way to get an economy up and going again? According to Japan‘s central bank, the answer is to print copious amounts of money. In the first policy statement since Haruhiko Kuroda took over as the head of the institution, the Bank of Japan outlined what’s being claimed as the most aggressive monetary policy since the Weimar Republic:

The Bank will achieve the price stability target of 2 percent in terms of the year-on-year rate of change in the consumer price index (CPI) at the earliest possible time, with a time horizon of about two years. In order to do so, it will enter a new phase of monetary easing both in terms of quantity and quality. It will double the monetary base and the amounts outstanding of Japanese government bonds (JGBs) as well as exchange-traded funds (ETFs) in two years, and more than double the average remaining maturity of JGB purchases.

Policymakers in Japan have been struggling for nearly two decades to find a solution to the deflation that’s hung over the country’s economy since the early 1990s. In the most recent election, it was a central facet of the new prime minister’s economic policy. And following his inauguration last December, he’s set upon accomplishing this objective by selecting Kuroda to chair the central bank.

According to the bank’s president, “Incremental steps of the kind we’ve seen so far weren’t going to get us out of deflation. I’m certain we have now adapted all policies we can think of to meet the 2 percent price target.” To read more about this, check out The New York Times article here.

2. MF Global Report
Thought you had heard the last about former New Jersey governor Jon Corzine and MF Global’s astonishing collapse? Think again.

This morning, the trustee for the failed commodity company’s bankruptcy issued its long-awaited report on what led to the collapse and how significant the damages were. As The Wall Street Journal noted, the bankruptcy trustee laid the blame squarely at Corzine’s feet, saying that a risky business strategy, inadequate systems, and “negligent conduct” contributed to the company’s unraveling.

“Corzine and his management team failed to strengthen the company’s weak control environment, making it almost impossible to properly monitor the liquidity drains on the company caused by Corzine’s proprietary trading strategy,” the report said. You can read the 124-page report here.

3. Jobs Data
According to data released today by the Labor Department, the number of Americans filing for unemployment benefits last week hit a four-month high. For the week ended March 30, the advance figure for seasonally adjusted initially came in at 385,000, an increase of 28,000 applications over the prior week. According to Reuters, economists had expected the …read more

Source: FULL ARTICLE at DailyFinance

Japan central bank revamps policy to boost economy

Japan is making a sweeping shift in its monetary policy, aiming to spur inflation and get the world’s third-largest economy out of a long, debilitating slump.

Bowing to demands from Prime Minister Shinzo Abe for more aggressive monetary easing, the Bank of Japan announced Thursday a policy overhaul intended to double the money supply and achieve a 2 percent inflation target at the “earliest possible time, with a time horizon of about two years.”

BOJ governor Haruhiko Kuroda described the scale of monetary stimulus as “large beyond reason,” but said the inflation target would remain out of reach if the central bank stuck to incremental steps.

“We’ll adjust without hesitation if need be, while monitoring economic and price conditions,” he said.

The BOJ is joining the U.S. Federal Reserve and other major central banks in soaking the economy in money in hopes of getting corporations and consumers to begin spending more in a virtuous cycle that would put growth back on track after two decades of malaise.

The central bank said it intended to “drastically change the expectations of markets and economic entities.”

Financial markets, which had feared Kuroda might not live up to expectation for bold steps, reacted with relief. The Japanese yen, which was trading at about 92.8 yen per U.S. dollar, dropped to about 95.5 yen per dollar after the announcement. The benchmark Nikkei 225 stock index rebounded from negative territory to close 2.2 percent higher.

“By committing today to meet a 2 percent inflation target in two years, Gov. Kuroda can justifiably claim to have set the Bank of Japan on a new path,” said Mark Williams of Capital Economics.

“But while markets have welcomed the announcement, the credibility of this pledge is soon likely to be called into question,” he said in a commentary.

Kuroda has pledged to do what he must to meet the inflation target within two years. Thursday’s decision after a two-day policy meeting makes that central bank policy. Signaling a consensus behind Kuroda, most items agreed upon received unanimous support from the nine-member board.

The policy shift is a coup for Abe, whose Liberal Democratic Party needs to make headway in reviving the economy before an upper house parliamentary election in …read more

Source: FULL ARTICLE at Fox World News

Why Gold Prices Will Explode Following Disappointing First Quarter

By Royston Wild, The Motley Fool

Filed under:

LONDON — Resurgent confidence in the global economy has propelled equities higher in recent months, and investors have in turn shunned the safety of traditional flight-to-safety asset gold. Indeed, the yellow metal is set to record its worst quarterly performance in more than a decade following a 3.7% drop to around $1,600 per ounce.

However, I am convinced that a backdrop of rising inflation — coupled with enduring hiccups in the macroeconomic recovery, particularly in the eurozone — should send yellow metal interest higher as the year progresses. Gold bugs can latch onto rising metal prices through SPDR Gold Trust  and Gold Bullion Securities , instruments that are designed to track movements in the gold price.

Central banks remain active gold buyers
A recent report from UBS showed official sector purchases in the first two months of the year come in at 54 tonnes, Forbes reported, representing a value around $3 billion.

Central banks, most notably in the world’s key emerging markets, have continued to bulk up their gold reserves in recent months. South Korea purchased 20 tonnes of the metal, it was announced earlier this month, while Russia and Kazakhstan also made substantial purchases in February.

Gold purchases by the world’s central banks came in at 534.6 tonnes in 2012, according to the World Gold Council, the highest level since 1964 and up 17% from the previous 12-month period.

The official sector has increasingly turned to the traditional safe-haven asset as an alternative to paper currencies, the value of which are expected to keep on eroding amid renewed stimulus measures in the West.

Monetary easing set to continue
In the U.S., Chicago Federal Reserve President Charles Evans just yesterday commented that the country’s central bank will maintain its bold asset program until a significant uptick in the jobs market materialises. This is not expected until the turn of the year at least.

Further afield, new Bank of Japan governor Haruhiko Kuroda is expected to aggressively bolster asset purchases in a bid to reach the institution’s 2% inflation target and end decades of deflation. Meanwhile, the European Central Bank is also widely tipped to cut rates, possibly as early as next week’s meeting, to boost the region’s flagging economies there.

To compound the global inflation problem, countries around the world are actively weakening their domestic currencies in order to keep their exports competitive. These “currency wars” are expected to ratchet up over the course of the year, placing further pressure on the value the world’s fiat currencies.

Interest in gold ETFs climbed during the height of the Cyprus bailout crisis, and in my opinion the likelihood of further political turmoil — combined with deteriorating economic data — should again boost gold inflows. Fallout from last month’s Italian election continues to rumble on, while German Parliamentary elections in September should herald fresh waves of uncertainty and thus interest in store-of-value gold.

Mine gold stocks for gains
Investors can also gain exposure to a rising gold price through shrewd stock picks in the mining sector. Galloping …read more
Source: FULL ARTICLE at DailyFinance

Has Japan Created a Day of Reckoning for U.S. Automakers?

By Adam Levine-Weinberg, The Motley Fool

US Dollar to Japanese Yen Exchange Rate Chart

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In the past six months, the yen has plunged in value relative to the dollar. Whereas $1 was worth less than 80 yen in late 2011 and throughout most of 2012, the exchange rate has moved by more than 20% since October, so that $1 approximately equals 94 yen.

U.S. Dollar to Japanese Yen Exchange Rate data by YCharts

This devaluation has come about primarily because of a change in government in Japan. Shinzo Abe’s LDP came to power in the December parliamentary elections, and Abe promised to restart economic growth by fighting deflation. Abe has since appointed a new governor of the Bank of Japan, Haruhiko Kuroda, who has promised a more dovish monetary policy. The shifting political winds have led to sharp declines for the yen against every other major currency.

A cheaper yen is a boon to Japanese exporters, such as automakers Toyota Motor and Honda Motor . By contrast, American automakers, such as Ford and General Motors could be at risk as their Japanese rivals gain a cost advantage. However, the ultimate impact of the yen’s move on these stocks depends on the strategies adopted by the Japanese automakers.

A white knight?
Japanese automakers have been complaining for some time about cost inflation caused by the strong yen. All of the major Japanese automakers have been moving production overseas in recent years to counteract the strong yen. That said, yen exposure is still high. For example, Toyota — by far the largest of the Japanese automakers — built roughly 3.5 million vehicles in Japan in 2012, more than half of which were exported. As recently as last summer, The Wall Street Journal reported that Japanese automakers were planning to move even more production overseas because they could not profitably export vehicles built in Japan.

The yen’s precipitous decline has made this point moot: the dollar cost of producing a car in Japan (with 100% Japanese components) is now nearly 20% lower than it was last summer. This is good news for all of the Japanese automakers. With lower costs, they can either pocket more profit per vehicle, or they can cut prices in order to gain market share in key regions like the U.S., while boosting export production to meet the additional demand.

However, this does not mean you should go running to buy Toyota today. While yen devaluation lowers production costs for vehicles built in Japan, it also lowers the dollar value of earnings from within Japan. This affects all of the Japanese automakers, but especially Toyota, which has captured nearly half of the Japanese market in recent years.

Moreover, the expiration of certain government tax credits in Japan in late 2012 led to several months of declining auto sales there. Lower sales volumes in Japan could cut significantly into profit for Toyota, Honda, Nissan, and other rivals. Toyota, as the dominant player in the Japanese market, would bear the brunt of …read more
Source: FULL ARTICLE at DailyFinance

Shinzo Abe's Central Bank Coup Fuels the Nikkei's Rise

By Dan Carroll, The Motley Fool

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Japanese stocks have been on a roll, and the Nikkei hasn’t let up its rise this week. The index rolled to gains of 1.3% over the past five days, fueled by Friday’s surge of more than 1.4% after the confirmation of new leadership at Japan‘s central bank that will only provide more ammunition to Prime Minister Shinzo Abe‘s inflationary goals. The Nikkei’s up more than 15.8% for the year and investors are happy, but will the good times roll on? Let’s get caught up on what you need to know.

Abe takes the BoJ
The Nikkei got its first bounce when Japan‘s Parliament confirmed the Bank of Japan‘s new governor, Haruhiko Kuroda. Observers expect Kuroda to go along with Shinzo Abe‘s dovish monetary plans that have so far sent the yen into a nosedive against the dollar this year. Kuroda and his new team will have their first policy meeting at Japan‘s central bank next month, and all eyes will be watching to see if any further easing comes as a result.

Eisuke Sakakibara, the former Japanese vice financial minister of international affairs in the late 1990s, said earlier this week that it would be “unlikely” that the yen-to-dollar exchange rate would soar past 100, but little has slowed down Abe’s currency devaluation so far in 2013.

Other nations haven’t been as happy about Japan‘s aggressive moves, however. A group of U.S. lawmakers spoke out against Japan‘s joining of free trade talks in the U.S. — proposed Trans Pacific Partnership (TPP). The TPP originally revolved around America and 10 other Pacific nations establishing a free trade deal, but Japan‘s willingness to join the discussion raised eyebrows over the country’s regulatory barriers that have in the past restricted American autos from the Japanese market.

Still, the talks haven’t hurt Japan‘s leading automaker, Toyota . The auto stock was named individual Japanese investors’ most popular stock in a survey by Nomura Holdings . Toyota’s shares have risen more than 7.8% on the NYSE, but the company’s Nikkei listing has shot up by a whopping 25% to outperform the index. Toyota already retook the global industry lead from rival GM in January, and while GM‘s surging ahead of Toyota in China with the ongoing Chinese-Japanese territorial dispute, the U.S.’s top car company faces plenty of challenges of its own. Further weakening of the yen will only help Toyota expand its worldwide lead as it advances internationally.

The falling yen will likely help out the financial sector as well, and Nomura’s been feeling the love recently. Japan‘s leading financial institution’s shares jumped almost 42% over the past three months, although it did take a blow earlier this week when Bank of America poached its Australian head of mergers and acquisitions. Mizuho Financial Group has also been having a great time recently, with shares up more than 39% over the past three months. The financial stock ranked as Japanese investors’ second most popular stock after Toyota in Nomura’s study, …read more
Source: FULL ARTICLE at DailyFinance

Dollar continues gains on positive economic data

The dollar is continuing to gain against world currencies following the latest signs that the U.S. economy is strengthening.

The Labor Department reported that applications for unemployment benefits fell to a five-year low last week.

The euro declined to $1.2948 from $1.2961 late Wednesday as European Union leaders gathered for a summit beset by anti-austerity protesters.

The dollar rose to 96.34 Japanese yen from 96.10 yen. Japan‘s lower house of Parliament endorsed Prime Minister Shinzo Abe‘s choice to lead the nation’s central bank. Haruhiko Kuroda is expected to ease Japan‘s monetary policy.

The British pound was one of the few major currencies rising against the dollar. It increased to $1.4992 from $1.4914.

…read more
Source: FULL ARTICLE at Fox US News

Currencies Stall as Weak European Data Weighs on Germany

By Dean Popplewell, Contributor

Yen and more selling of it just about sums it up for another relatively dull overnight foreign exchange (forex) session perforated with a few CNY band-widening rumors. Well, it was dull until the release of disappointing UK data continued that economy’s dismal uninterrupted economic run. USD/JPY traded to 96.70, a three-and-a-half year high, in response to dovish comments from Kikuo Iwata, nominee for the Bank of Japan (BoJ) deputy governor and on reports that BoJ governor nominee Haruhiko Kuroda will hit the ground running, and launch easing steps as early as next week. …read more
Source: FULL ARTICLE at Forbes Latest

Japan nominates vice finance minister to lead ADB

Japan has nominated Takehiko Nakao, its deputy finance minister for international affairs, to become president of the Asian Development Bank.

The Finance Ministry proposed that Nakao succeed current ADB president Haruhiko Kuroda, who has been nominated to become Japan‘s next central bank governor and resigned as ADB president effective March 18.

Japan nominates the president of the Manila, Philippines-based regional lender due to its status as the ADB‘s biggest donor. Kuroda’s planned departure has raised speculation that China might seek a chance to lead the bank.

Finance Minister Taro Aso said Thursday that he believed Nakao, a 35-year Finance Ministry veteran who mainly handles Japan‘s currency affairs, was the best qualified person for the job.

Aso said he expected the ADB president to be chosen on an “open, transparent and merit basis.”

Kuroda, 68, had previously served as deputy finance minister and was Japan‘s top financial diplomat. He had served as ADB president since 2005.

Like Kuroda, Nakao is a fluent English speaker.

The government expects to win parliamentary approval for Kuroda’s nomination to head the Bank of Japan after its current governor, Masaaki Shirakawa, steps down on March 19.

…read more
Source: FULL ARTICLE at Fox World News

What's Driving These Insurers Higher?

By David Hanson, The Motley Fool

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The adverse impacts of “home bias” investing, the tendency for investors to hold primarily domestic investments, may be dwindling. Historically, investing in domestically domiciled companies left portfolios greatly exposed to country-specific events. However, as international revenues continue to make up a larger portion of U.S. companies’ total revenues, investors in these companies are becoming increasingly exposed to global events, both positive and negative.

Haruhiko Kuroda: Deflation Fighter
Shares of MetLife and Prudential Financial moved higher today after Haruhiko Kuroda, expected to be Japan’s next top central banker, vowed to launch significant monetary easing plans to combat the growth-crippling deflation that has hindered growth in the world’s third largest economy. Both U.S. companies have considerable exposure the Japanese economy. Around 30% of Prudential’s 2012 revenue was derived from its Japanese operations, while 16% of MetLife’s revenue came from the island nation.

Waddling through Japan
Japan is not an undiscovered opportunity for U.S. insurers. Although most American consumers associate Aflac with a squawking duck and supplemental coverage, Japanese citizens recognize the company as the number one life insurance provider in the country in terms of individual policies. In 2012, Aflac Japan accounted for 77% of all Aflac revenue and a staggering 87% of total assets. These insurance companies offer international exposure to investors who are wary of investing in American Depositary Receipts or in non-U.S. public markets.

Opportunity abound
As barriers to international expansions continue to fall in emerging markets, companies that offer specialized products, such as supplemental health insurance, have an opportunity to establish new revenue streams. Although country-specific regulations and political risks will always have to be navigated, companies with existing international exposure will have the expertise to establish a meaningful presence. As the natural evolution of international expansion continues, the risk associated with “homes bias” will undoubtedly shrink. 

The world of insurance can be a volatile one at times. After bringing the financial world to its knees, most investors are wary about owning a stake in AIG today. We’ll fill you in on both reasons to buy and reasons to sell AIG, and what areas AIG investors need to watch going forward. Just click here now for instant access.

var FoolAnalyticsData = FoolAnalyticsData || []; FoolAnalyticsData.push({ eventType: “TickerReportPitch”, …read more
Source: FULL ARTICLE at DailyFinance

ADB's Kuroda pulls ahead in race to lead Bank of Japan: media

Daiwa Institute of Research Chairman and former Bank of Japan Deputy Governor Toshiro Muto speaks during an interview with Reuters in Tokyo

TOKYO (Reuters) – Asian Development Bank chief Haruhiko Kuroda is leading the race to become the new governor of Japan's central bank, according to media reports on Sunday, as Prime Minister Shinzo Abe nears a decision on who will head the bank's fight against deflation. The government has said it will decide its nominee this week and Abe was expected to huddle with aides to reach a final decision after returning from a U.S. trip on Sunday. Still, whoever Abe nominates is not certain to get the job because the appointment must be approved by both houses of parliament. …

…read more
Source: FULL ARTICLE at Yahoo Business