I’ll Order Some Toro and a Side of Tandoori!
It’s no secret that we have been bullish on Indian and Japanese stocks
It’s no secret that we have been bullish on Indian and Japanese stocks even as we have continued to express concern over the inflated multiples in the U.S. major averages. Our long-standing constructive view of these two Asian giants has been drowned out by our bearish sentiment on the U.S. (great companies, but the share prices of many are far too high for our liking).
The case for Japan is a rather easy one (as we just published in our special report: Abe’s Legacy Lives On: The Structural Bull Case for Japan), where potential GDP growth is expanding, CEOs are generating ever-higher all-in yields (Japanese buybacks used to be an oxymoron), and a nascent equity culture is underway. The pundits who come on CNBC frequently talk about the “wall of cash” ready to be deployed in the U.S. equity market — but this argument is even more appealing in Japan, where households hold more than half of their $14.7 trillion of financial assets in cash and deposits. This 50%+ share ($7.7 trillion) compares to 13% in the U.S. (and 31% in the U.K.).
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