Wednesday, 26 December 2012

Kyle Bass: 5 Reasons Why Japanese Bond Market Will Collapse by 2016

Watch the full lecture on Americatalyst:
Kyle Bass' web site:

The long-end of the Japanese yield curve is at near-record steeps...
(h/t zerohedge)

Illustrated chart article source:

The five reasons Bass expects the Japanese government bond market to collapse are as follows: 

1. Japan has an extremely high amount of debt; it simply cannot be repaid. 
2. Interest expense on debt is very high and growing.  
3. Contrary to popular belief, Japan is NOT self-funding. The Bank of Japan will need to print more money in the years to come.  
4. Japan's demographic crisis has arrived. The country's population is declining, its taxable income is declining, savings rate are declining, and social security payments are rising.  
5. The Japanese government is at a loss for how to deal with the problem. 

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