Dear Valued Visitor,

We have noticed that you are using an ad blocker software.

Although advertisements on the web pages may degrade your experience, our business certainly depends on them and we can only keep providing you high-quality research based articles as long as we can display ads on our pages.

To view this article, you can disable your ad blocker and refresh this page or simply login.

We only allow registered users to use ad blockers. You can sign up for free by clicking here or you can login if you are already a member.

Playing Mr. Kuroda’s Wild Ride: DDR Corp (DDR), iShares MSCI Japan Index (ETF) (EWJ)

Page 1 of 2

Here’s the easiest trade to make in the history of Earth:

Buy Japan. Sell Europe.

The reasons have nothing to do with fundamentals, and everything to do with the strategic thinking behind policy.

DDR Corp (NYSE:DDR)Inflation Can Be Good

The new head of the Bank of Japan, Haruhiko Kuroda, is determined to end the generation of deflation that has devastated his country’s economy like Godzilla plundering paper Tokyo.

Once his predecessor leaves the job on March 19, a few weeks from now, Kuroda will embark on an unprecedented program of yen easing. He will be buying assets with a view toward weakening the yen and creating inflation. He will be increasing the yen supply drastically.

Inflation, you see, is not an altogether bad thing. When prices go up producers get more, which means they can spend more. And consumers are encouraged to spend more because as the prices are going up, the value of what’s in their pocket is going down. Inflation, in limited degrees – and Kuroda’s target is just an inflation rate of 2%, about the US rate – actually stimulates growth. It encourages people to go into their mattresses and buy assets, and it encourages corporations to break into their cash hoards and invest.

It’s stimulus. It’s not as good as the stimulus you get from actually spending government money, but it’s stimulus. That means the value of the yen goes down, but the value of Japan’s economy goes up. It means Japan is going to start growing again.

Don’t Bet On US, Either

Contrast that with the policy in Europe, which is being run by Germany.

There you have both fiscal and monetary drag. Governments are being told to spend less, to tax more, which means they can’t grow. And the supply of Euros is being kept in check with super-low interest rates at the center, in Germany. The only game available to traders is speculating, back-and-forth, on policies at the periphery, in Italy and Spain and Ireland. You sell them as austerity deepens, you buy them as austerity relents. It’s not a fun game, because it’s not a fun place to hold assets these days.

Page 1 of 2

Biotech Stock Alert - 20% Guaranteed Return in One Year

Hedge Funds and Insiders Are Piling Into

One of 2015's best hedge funds and two insiders snapped up shares of this medical device stock recently. We believe its transformative and disruptive device will storm the $3+ billion market and help it achieve 500%-1000% gains in 3 years.

Get your FREE REPORT and the details of our 20% return guarantee today.

Subscribe me to Insider Monkey's Free Daily Newsletter
This is a FREE report from Insider Monkey. Credit Card is NOT required.
Loading Comments...

Thanks! An email with instructions is sent to !

Your email already exists in our database. Click here to go to your subscriptions

Insider Monkey returned 102% in 3 years!! Wondering How?

Download a complete edition of our newsletter for free!