Lance

Japanese Market Awakening from Its Long Slumber?

Lies, damned lies, and statistics.

Sure, Japan is outperforming in the short time frame of less than 90 days. Yes, Japan is up from the March lows ~20 percent versus ~10 percent for the US.

But one would assume that you are aware that Japan bottomed nearly a full 35 percent (!) off its 2007 highs, whereas the US bottomed roughly 19 percent off its 2007 highs.

So the US currently stands (basis the S&P 500) about 11 or 12 percent off its 2007 highs, while Japan's Nikkei 225 still remains, after this 20 percent rally, about 21 percent below its 2007 highs. Yes, Virgina, it takes more of a percentage gain to get back the larger percentage loss, and Japan is still hanging on to a dandy loss from last year. In fact, Japan is still farther down from it's 2007 highs than the S&P 500 was at the apparent *bottom* of its swoon on March 17.

Now tell me who is outperforming whom in, say, the past 11 months.

Note: The TOPIX is running about 3 percent better than the Nikkei, but both Japanese indices languish much lower compared to their 2007 highs than the S&P 500. An equivalent S&P 500 loss from the 2007 highs would have taken that index down to somewhere just above 1,000. So far, it's never gotten close.