Thu, Dec 18, 2014
A A A
Welcome Guest
Free Trial RSS
Get FREE trial access to our award winning publications
Alternative Market Briefing

Hedge fund manager claims Japanese debt worse than that in Greece

Tuesday, December 11, 2012

Beverly Chandler, Opalesque London: Hedge fund manager, Chris Rigg, from Audley Capital believes that the debt levels in Japan are worse by some measures than those in Greece. Rigg has issued a stark message about investment in Japanese bonds.

"The level of debt Japan is running, which by some measures is far worse than in Greece, is unsustainable," said Rigg. "With net debt at 140% even if Japan were to run a budget where revenue and expenditure were balanced before interest costs, the economy would have to grow by 1.8% in nominal terms just to stabilize the debt/GDP ratio. The reality is that the Japanese government spends twice as much as tax revenue and debt servicing costs consume half of tax revenue."

Rigg said: "Japan enjoys some of the lowest borrowing rates in the world, principally because of its current account surplus but this is now shrinking fast with Japan running its first seasonally adjusted deficit since 1981."

Looking towards the Japanese general election on 16th December, Rigg notes that all polls are predicting a defeat for Yoshihiko's Noda's Democratic Party of Japan. "We are looking for a major correction in bonds, currently near historic highs, whilst equities should increase, as the new government undertakes moves to eradicate deflation before the imposition of a consumption tax in April 2014".

"We think the best way for Japan to exit deflation woul......................

To view our full article Click here

Today's Exclusives Today's Other Voices More Exclusives
Previous Opalesque Exclusives                                  
More Other Voices
Previous Other Voices                                               
Access Alternative Market Briefing


  • Top Forwarded
  • Top Tracked
  • Top Searched
  1. Investing - Big hedge funds win again on PetSmart, Riverbed, RBS sells real estate loans to hedge fund Cerberus, Talisman energy speculation: Which hedge funds could benefit?[more]

    Big hedge funds win again on PetSmart, Riverbed From CNBC.com: Another week, another set of wins for activist investors. On Sunday, pet supply retailer PetSmart agreed to the largest leveraged buyout of the year at $8.7 billion. Hedge fund firm JANA Partners had been pushing for a sale a

  2. Outlook - Hedge fund manager who remembers 1998 rout says prepare for pain, Bond guru Bill Gross predicts U.S. economic growth to dip to 2%[more]

    Hedge fund manager who remembers 1998 rout says prepare for pain From Bloomberg.com: Stephen Jen landed in Hong Kong in early January 1997 as Morgan Stanley’s newly minted exchange-rate strategist for Asia. He was soon working around the clock when investors began targeting the region’s

  3. Opalesque Exclusive: U.S. legal receivables fund launched in August[more]

    Benedicte Gravrand, Opalesque Geneva for New Managers: Investing in asset-backed receivables is a strategy that has been an integral part of the alternative investment space within the overall fixed income asset c

  4. Comment - High fees and low performance hit hedge funds[more]

    From FT.com: Disenchantment over high fees and lackluster performance may finally be turning the tide against hedge funds, fresh data suggest. Despite generally weak returns since the global financial crisis, hedge funds have enjoyed positive net inflows every year since 2010. This helped assets und

  5. Performance - Lansdowne, Man Group, other hedge funds profit from shorts in oil, Turmoil boosts hedge funds that bet against Russia, oil, CTAs post strongest returns since December 2010[more]

    Lansdowne, Man Group, other hedge funds profit from shorts in oil From Valuewalk.com: The rising short interest in oil companies implies that the worst for oil is yet to come. Data from Markit shows that short exposure in energy sector of S&P 500 is still looming close to the highest mar