Japan brings money home to rebuild

[kpete]

Source: Reuters

Japan brings money home to rebuild

By Burton Frierson

NEW YORK | Sun Mar 13, 2011 4:38pm EDT

NEW YORK (Reuters) - Shaken by the prospect of nuclear meltdown after a devastating earthquake and tsunami, Japanese investors will dump overseas assets on Monday and bring their money home to help finance reconstruction.

Positioning for this could send the dollar plummeting versus the yen on Monday and lead to a sharp slide in Treasuries since U.S. government bonds are a favorite asset of Japanese investors, market analysts said.

Stocks also are likely to come under pressure.

Japanese insurers will probably sell some of their most liquid foreign assets such as U.S. Treasuries so they can respond to the worst disaster since World War Two.



Read more: http://www.reuters.com/article/2011/03/13/us-markets-weekahead-idUSTRE72A31H20110313

[kpete]

1. kudlow is not going to like this...

KUDLOW Re Japan:
"The HUMAN toll MUCH worse than the ECONOMIC toll and we can be GRATEFUL for that"
http://www.vanityfair.com/online/daily/2011/03/larry-kudlow-devalues-human-life-with-japan-earthquake-freudian-slip.html

[marmar]

3. He's a sick bastard.

nt

[RandySF]

2. Imagine the cash we could have raised for the Gulf Coast.

[gateley]

4. A TRULY patriotic populace. That would never ever ever happen here. nt

[lumberjack_jeff]

8. No shit. Remember Dick Cheney betting on a declining US economy?

http://www.counterpunch.org/whitney07052006.html

[Demeter]

11. Please! This will Be Sovereign Wealth Fund Money

In other words, their equivalent of the Federal Reserve, liquidating the nation's surplus cash.

[DeSwiss]

5. Total collapse.....

...is a breath away.

K&R

[pam4water]

6. They probably wont do anything with it, but I thought the Japanese banks are awashed in currency

like a lot of US banks and corporations.

[RandySF]

7. If that happens

Expect Palin's "thoughts and prayers" to turn into "don't retreat, reload".

[Fool Count]

9. That's not good for US Dollar.

They will be selling at least $50 billion worth of USD denominated assets and then converting the proceeds into yen to cover the claims.
Could be even as high as $100 billion. Of course, Bank of Japan already injected $85 billion worth of liquidity to cover the reconstruction
needs and keep the yen at a reasonable level, but still USD is becoming even more vulnerable. The currency speculators will not help the
cause by rushing into yen too. It seems counterintuitive that currency of so badly affected country would surge, but given Japan's massive
foreign currency (well, mostly USD) reserves and their need for a strong yen to make the reconstruction more affordable, that is likely to
happen.

[timo]

10. if those reactors go......

boooom it could get a lot higher than 100B, course then maybe on the other hand if they do go boom, they wont be rebuilding much of anything.