Japan – when printing money fails

Japan, the world’s 3rd largest economy, has been printing more money per head of population than any other country.  For a while it stimulated the stock market and industry whilst reducing their currency.  But, like the US, it’s a double edged sword and its effectiveness is wearing off leaving nothing but the threat of hyperinflation.  Japan just reported their 22nd consecutive month of declining wages, it is also seeing a strongly rising inflation rate, the stock market is falling and now their manufacturing index (PMI) has plummeted to a 14 month low (see graph below).  There is now broad speculation about whether they will increase their money printing.  No wonder the Japanese have started buying gold in record amounts as they wake up and look to protect their wealth.