V.8:8 (310-312): Japanese Stocks: Potential Calamity Or Business As Usual? by Eric L. Sharp

V.8:8 (310-312): Japanese Stocks: Potential Calamity Or Business As Usual? by Eric L. Sharp
Item# \V08\C08\JAPAN.PDF
Availability: In Stock

Product Description

Japanese Stocks: Potential Calamity Or Business As Usual? by Eric L. Sharp

Market calamities can be interesting, profitable and even fun to watch. We've had a few of our own in the U.S., with the savings and loan debacle and the junk bond market hijinks. People who talk about how efficient markets are should be required to explain why these major market screwups occur when the signs leading up to them are often obvious. The Japanese stock market is another example. It serves as a good lesson on how an objective statistical evaluation can keep you on the right side of things.

For several years now we've heard about the terrific runup in the Japanese stock market. That was true; it outperformed the U.S. equity market by a wide margin. We also heard that the Japanese had driven their market up in disregard of all sensible valuations. In early 1987 Japanese price/earnings ratios (P/Es) were well over 60 in comparison to U.S. P/Es, which were considered very toppy in their low 20s. Open speculation was that a crash was going to take place and that it might very well start in Japan and drag us along. As it happened, it occurred just the other way around.

In October 1987 the Tokyo market fell less than New York's did, and then it went on to new highs. That really sparked the outrage of the fundamentalist P/E watchers. How could such a thing be?

*Note: $2.95-$5.95 Articles are in PDF format only. No hard copy of the article(s) will be delivered. During checkout, click the "Download Now" button to immediately receive your article(s) purchase. STOCKS & COMMODITIES magazine is delivered via mail. After paying for your subscription at store.traders.com users can view the S&C Digital Edition in the subscriber's section on Traders.com.

Take Control of Your Trading.
Professional Traders' Starter Kit
All these items shown below only $299.99!
  • 5-year subscription to Technical Analysis of STOCKS & COMMODITIES, The Traders' magazine. (Shipping outside the US is extra. Washington state addresses require sales tax based on your locale.)
  • 5 year access to S&C Archive
  • 5 year access to S&C Digital Edition
  • 5-year subscription to Traders.com Advantage.
  • 5-year subscription to Working Money.
  • Free book selection.
  • Click Here to Order