The Bank of Japan is the most prolific manipulators of asset prices in the world, which was forecasted here long ago and the reason why the NIKKEI was my top pick for 2013.
HIG just guided up, partly tanks to its Japanese exposure.
Taking a quick glance at Japanese stocks traded here, most are in the green and making new highs. The NIKKEI is +55% since November.
Outperformers include TM, KUB, NMR, IX and MTU. Two stocks that haven’t moved yet that should benefit from the sinking yen are HMC and CAJ. After a market decline, it’s worth a shot.
The big story of 2013 is the move up in mega cap dividend payers. Long term investors need yield. There is a select group of stocks, with caps over $10 billion, that are quietly minting coin for their investors.
Here are some notable outperformers.
BX, XRX, WAG, KMB, CPB, BMY, BLK, CNP, PAA, BDX, CSX and EXC.
Truth is, I have more than 200 names with market caps over 10 billion, yielding more than 2%, that are +10% year to date. It’s incredible and of course absurd.
This market is begging for a beat down. It’s real hard to bet against liquidity because “they” have an infinite amount of money. Nevertheless, even they know markets need the illusion of normalcy. Periods of distress can only embolden public opinion in their favour.
Therefore, you should expect markets to behave as they have in the past, because they’re too lazy to deviate from the blueprint.
May will be down and those losses will redouble in June. By July, the media will be clamoring for more QE. Hence, Bernanke’s job will be supported by a vocal Wall Street, helping him manage the US economy with impunity.
If this plays out the way I just explained it, volatility will be a supreme buy towards the end of April and taking a net short position will be extremely profitable by June. However, be mindful that it’s an extremely difficult task, this business of timing tops. You might be better served taking my approach via a very large cash position and the patience of an elephant.
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