What Usually Happens When a the S&P 500 Drops 5 Percent in a Week

A phrase I always heard when studying at collage ;”:

History never repeats itself but mirrors it 

 Looking back at other crashes gives us a interesting outlook , 60% of the time the index goes up the following week .


Bloomberg Link – News

Japan resume nuclear power activities today

On Tuesday of this week, Japan will begin restarting its nuclear power programme, officials said, after a two-year shutdown sparked by public fears following the Fukushima crisis.

The restart comes more than four years after a quake-sparked tsunami triggered meltdowns at the Fukushima plant, prompting the shutdown of Japan’s stable of reactors in the world’s worst atomic crisis in a generation.

Resource-poor Japan, which once relied on nuclear power for a quarter of its electricity, restarted two reactors temporarily to feed its needs, according to deVere Group sources. However, they both went offline by September 2013, making it completely nuclear-free for about two years.

Japan has ushered in tougher safety rules to avoid a repeat of Fukushima, including more backup prevention measures and higher tsunami-blocking walls in areas most susceptible to them.

The government of Prime Minister Shinzo Abe is keen to get some of about four dozen reactors back up and running. So are the power companies that own them, fed up with having to make up lost generating capacity with pricey fossil fuels.

“It is important for the country’s energy policy that the government go ahead with reactor restarts once they are confirmed as safe,” top government spokesman Yoshihide Suga told reporters Monday.
“The biggest priority is safety.”

The reactor No. 1 at the Sendai nuclear plant, nearly 1,000 kilometres (620 miles) southwest of Tokyo, has been loaded with atomic fuel. Its operator announced Monday the reactor would be switched on by 10:30 am (0130 GMT) Tuesday.

deVere Group is the world’s leading independent financial consultancy offering various financial services such as retirement planning, education planning and private pension guidance.


24 July 2015 – Article by IP Global


Years of stagnation are giving way to excellent real estate investment opportunities in the reawakening Japanese capital

Confidence is rising in the property potential on offer in Japan’s capital. The government’s Abenomics policies are revitalising the national economy, and nowhere is this more apparent than Tokyo – the world’s largest metropolitan city. 

And with the Yen remaining weak against the US Dollar, overseas investors are at a distinct advantage when it comes to entering this re-emerging market. 

What is Abenomics? 

The economic stimulus programme implemented by Japanese Prime Minister Shinzō Abe since he won his second term in office in late 2012 quickly became known as “Abenomics”. The Economist has described this as a “mix of reflation, government spending and a growth strategy designed to jolt the economy out of the suspended animation that has gripped it for more than two decades.” 

Is it working? 

It appears so. The financial markets provide the strongest evidence, with the Nikkei 225 index surging nearly 100% since June 2012. The quantitative easing demanded by the Abenomics project has kept the Yen weak against other currencies, significantly grown export volume and kept interest rates under 1%. 

Unemployment in Japan has also fallen significantly over this period, dipping to just 3.3% in April 2015, the lowest level recorded since 1998. 

Confidence is growing – the Mizuho Research Institute forecasts the Japanese economy will grow to around JPY600 trillion by 2020. 

What does this mean for Japanese property? 

Japan is home to the world’s second-largest real estate investment market, and has seen a surge in interest and action from foreign investors over the last two years.

This interest is being driven both by the economic upswing underway in Japan, as well as by the deregulation implemented under Abenomics, which has included the opening up of J-REIT’s to foreign investment and the relaxing of planning laws in key metropolitan areas. 

Prices have been slowly improving since Prime Minister Abe’s December 2012 re-election, and by the end of 2014 the Japan House Price Index had recorded growth of 4.9%. Money continues to flow into real estate given the inflation outlook, and prices are subsequently expected to continue this upward trend in the years ahead. 

Why Tokyo? 

Tokyo is the world’s largest metropolitan economy – worth USD1.6 trillion. Of the companies listed on the Fortune Global 500, 38 are based here, more than any city other than Beijing. 

Tokyo is also the world’s largest metropolitan area, with a population that in 2014 reached 35.9 million – over four times the size of London or New York. This population has grown 0.6% per annum over the last decade, and while populations have actually begun to decline across the rest of the country, central Tokyo is expected to continue attracting residents into the 2030’s.

The city is currently going through an infrastructure investment boom in the lead up to its hosting of the 2020 Olympics. The Games themselves are forecast to directly inject some JPY3 trillion to the economy, but the associated regeneration and infrastructure investment will be even more beneficial, contributing up to JPY23 trillion to the metropolitan economy. 

Time to invest in Tokyo? 

While property prices across Japan have been showing signs of recovery since late 2012, recent performance in Tokyo has been considerably more impressive. 

Alongside the factors already mentioned, prices are being driven up by a significant undersupply of housing. The city’s construction pipeline remains below its ten-year average, a trend which has already fostered steady price growth of 10% across Tokyo’s main 23 wards in the year to April 2015. 

The situation is even more positive in Tokyo’s prime central wards, where prices grew 13.4% over the same period. While citywide rents have risen 2% year-on-year to reach their highest level since Q4 2009, the city’s five central wards now demand a 16% rental price premium on the 23-ward average. This strong rental performance is translating into a gross yields of up to 4.2% for prime location new-build apartments. 

Land prices in these central wards recorded their second consecutive year of growth in 2014, with Chuo the outstanding performer with an increase of over 10% across two years. This trend is a key indicator of improving sentiment and the increasing demand for properties in the heart of the city.

Affordability is another aspect of Tokyo’s investment case. The affordability ratio of Tokyo-Yokohama was just 4.9 in Q3 2014. This compares very favourably with other major global gateway cities, with New York- New Jersey at 6.1, London at 8.5, Sydney at 9.8 and Hong Kong at a massive 17. 

And of course this affordability is only enhanced by the weak Yen. The Japanese currency continues to decline against the US Dollar, losing a further 18% over the 12 months to June 2015. 

This puts many foreign investors in an excellent position: a JPY30 million property that would have cost USD380,700 in July 2012 would today cost just USD241,500.

It’s hard to ignore the positive signs coming out of Tokyo at the moment, which is why we’ve been closely monitoring investment opportunities in the city for over a year now. Look out for our first Tokyo development which is due to launch very soon.

Abenomics helping Toyota increase profits by 10%

Toyota sees first quarter profits rise 

Japanese carmaker company, Toyota, reported a 10% increase in profits for the first quarter of this year, helped mainly by a weak currency and internal cost cuts. 

According to deVere Group sources, the company’s net income rose to 646.3bn yen (£3.34bn, $5,2bn) from 587.7bn yen for the period from April to June when compared to a year earlier. 

Moreover, Toyota – recently overtaken by VW as the world’s largest carmaker – raised its sales forecast for the full fiscal year. 

Meanwhile, Toyota’s sales in Japan were slightly lower, but sales in North America rose while Europe remained almost flat. On the back of a weaker yen, Japanese car exports have benefitted from the US economy’s recovery in the past months. 

Meanwhile, overall economic conditions in Europe also continued to recover though there still is concern over the impact of the Greek debt crisis, deVere Group understands. 
The biggest sales falls were seen in Asia, South America, Africa and the Middle East, with emerging markets seemingly affected by a slowdown in economic growth. 

In their outlook for the rest of the fiscal year, Toyota said it revised its vehicle sales forecast from 8.9 million to 8.95 million units. 
As the world’s leading independent financial consultancy, deVere Group offers a range of tailored financial services such as retirement planning, QROPS advice, and guidance on issues such as inheritance tax and education fees. 

Click here to contact deVere Group and better understand how we can help you plan for a safer and more secure financial future. 


Gulf agreement could this push oil lower ?

Gulf backs Kerry’s proposed deal with Iran 
Countries in the Gulf gave cautious backing to the nuclear deal with Iran, handing the US government an important diplomatic card as it seeks to gain congressional support for the agreement. 
Speaking alongside US secretary of state John Kerry after a meeting in Doha, Qatari foreign minister Khalid al-Attiyah said that the agreement which the Obama administration helped negotiate with Iran would make the “region safer and more stable”, deVere Group understands. 

The careful endorsement by the GCC countries could prove politically valuable for the Obama administration which is facing intense criticism from Republican lawmakers over the deal agreed last month in Vienna, as well as from the Israeli government. 

The comments will help the administration counter one of the criticisms of its nuclear diplomacy with Iran – that it was openly opposed by both Israel and Washington’s Arab allies. 

Congress is expected to vote on the Iran nuclear agreement before mid-September. While the administration is likely to lose the vote, given the strength and unanimity of Republican opposition, US officials are confident that there will not be the two-thirds majority in both houses of Congress that would be needed to overturn a presidential veto. 
Contact deVere Group today to find out how we can help you sort out a solid retirement plan. 


IMF tells  Japan needs to bring back Abenomics – 

Japan is on the receiving end of a warning from the International Monetary Fund (IMF) about the risk of slow growth, stagflation and a new round of turmoil in financial markets. The IMF has urged Japan to “reload” its Abenomics reforms to prevent this from happening.  Currently the Bank of Japan  quantive easing ¥80 trillion ($712 billion)  the same as the  GDP of the Netherlands , an extra 10 Trillion  in my option would weaken the yen by 5/7% and the Nikkei rise by 9/11%…

According to the Financial Times, IMF economists have said that Japan is seeing a modest recovery at the moment and that there would be annual growth of 0.8% by the end of the year, followed by 1.2% in 2016. However, the economy is fragile, the report states. 

This is because imperative structural reforms required to bring the economy out of its slow growth and back on track have stalled and it comes at a time when Japan’s public debts were expected to hit 250% of GDP over the next five years. 

The Bank of Japan has also been told that it needs to be ready to ease monetary policy further and do a better job of communicating its intentions to markets as inflation – which they forecast would hit 0.7% this year – continued to rise more slowly than expected towards the central bank’s 2% target. 

Overall the IMF offered a sobering assessment of Prime Minister Shinzo Abe’s efforts to revive the Japanese economy, arguing that his reforms were failing to deliver as promised. 


JPMorgan predict Grexit, as Goldman Sachs hold on Greece staying in Eurozone 

Economists from JPMorgan Chase & Co. to Barclays Plc believe that a Greek departure from Europe’s monetary union is imminent, whilst economists at Goldman Sachs Group Inc. and Citigroup Inc. believe that there are ways it can remain within the bloc. Personally I also believe that Greece will stay in the Euro as what is the other options for them ? They can’t go to the IMF as they allready in “default” .
Investors are reconsidering the odds on Greece’s membership of the euro after voters used Sunday’s referendum to scrap the austerity needed to secure international aid. 

Even so, forecasts of a so-called Grexit over five years of crisis have so far come to nothing as European authorities have frequently acted to keep the bloc whole. 

“Although the situation is fluid, at this point Greek exit from the euro appears more likely than not,” Malcolm Barr, an economist at JPMorgan in London, said in a report, adding it could come “under chaotic circumstances.” 

“Exit now is the most likely scenario,” Barclays analysts said in a separate report. “Agreeing on a program with the current Greek government will be extremely difficult for euro- area leaders, given the Greek rejection of the last deal offered, and will be a difficult sell at home.” 

Morgan Stanley said that its analysts now calculate there is a 75% chance Greece leaves, up from 60% a week ago. BNP Paribas SA said the likelihood is at 70%, up from 20%. Societe Generale SA put it at 65%.

Goldman Sachs repeated that it still sees the euro area remaining a region of 19 countries despite the vote. 


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