2015 was a tough year for traders.
Not for investors, mind you, we did great but trading and trend following was a tough road to follow in 2015 as so many of the "usual" tricks didn't pan out as expected. A lot of that is because our governments have been lying to us – even as they do their best to manipulate the economy. You can't trust the data, you can't trust the reports and you can't trust what they say they will do or know when they will actually do it. That makes for a rough trading climate.
As Fundamental investors, we've been worrying over the same question all year, which is: "would we have an economy at all without the non-stop flow of funds coming from our Central Banksters?" So far, we haven't been given the chance to find out because the money keeps pouring in and it seems to make the markets happy – at least for a little while…
In Japan, however, where the Government embarked on a MASSIVE stimulus program called "Abenomics" back in Dec of 2012, the effects of a stimulus that dwarfs that of the US, China or Europe in terms of percentage of GDP (over 15% in Japan) has already faded out with Household Spending already going right back off a cliff:
That's because, unlike Americans, Japanese people understand math and they KNOW they don't have enough money to retire with – so they stop spending money and no matter what further steps the Government takes to punish the savers (negative interest on savings, constantly devaluing the currency, etc.), it's not enough to convince Japanese families to forego their future in return for some short-term pleasures.
The December data we're getting out of Japan is, in fact, horrific:
- Household Spending plunges 2.9% YoY – worst since March (post-tax-hike)
- Jobless Rate jumps to 3.3% (from 3.1%)
- Industrial Production drops 1.0% MoM – worst in 3 months
- Retail Trade tumbles 1.0% YoY – biggest drop since March (post-tax-hike)
- Retail Sales plunges 2.5% MoM – Worst drop since Fukushima