Will the yen strengthen and the stock market decline due to Ishiba shock?! Comparison of economic policies of the three leading candidates in the LDP presidential election on the 27th
The Liberal Democratic Party presidential election to be held on the 27th seems to have narrowed down to three candidates according to various media. The three candidates have significantly different stances on economic policies.Depending on who becomes the de facto next prime minister, it is inevitable that it will impact the stock market.It is a critical situation. The economic policies of the top 3 candidates and how they will impact stock prices can be inferred from past reports and statements regarding fiscal policy and the Bank of Japan's interest rate hike policy.
The ones believed to have a high chance of winning the presidential election are,Shigeru Ishibaa former Secretary-General of the Liberal Democratic Party,Sanae Takaichithe Minister of State for Economic and Fiscal Policy,Shinjiro KoizumiThree former environment ministers.
Most media outlets are reporting that the runoff vote is expected to be held between the top two out of the three candidates. If it becomes a critical runoff vote with a high weight of parliamentary votes, there is a widely held view that Mr. Ishiba is at a disadvantage.
Most media outlets are reporting that the runoff vote is expected to be held between the top two out of the three candidates. If it becomes a critical runoff vote with a high weight of parliamentary votes, there is a widely held view that Mr. Ishiba is at a disadvantage.
It is considered that the highest likelihood of a stock market rally would occur if he becomes the 'next prime minister.'Mr. Takai...It would be a typical proactive fiscal policy combined with cautious interest rate hikes. Mr. Takai, who received support from the late Prime Minister Shinzo Abe in the 2021 party presidential election, is known as a 'Reflationist' like Abe, and is expected to continue Abenomics.It is expected that he will inherit Abenomics.The first two arrows of Abenomics are monetary easing and fiscal stimulus, and adding growth strategy to this will promote economic growth.
In contrast to Mr. Takashi,IshibaMr.
In an interview with Reuters news in July after the additional rate hike, he supported the BOJ's policy, stating, "It is the correct policy to gradually realize a world with interest rates while not changing the basic policy of monetary easing.""There are also benefits to returning to a world with interest rates, which leads to a transformation of Japan's economic structure" (Reuters news dated August 6).It is also beneficial to gradually return to a world with interest rates, which leads to a transformation of Japan's economic structure"There are also benefits to returning to a world with interest rates, which leads to a transformation of Japan's economic structure" (Reuters news dated August 6).and supported the BOJ's policy.
Regarding fiscal policy, the announced policy set states " the economy needs fiscal policy ", and declares to "achieve sustainable stable growth while advancing the improvement of the fiscal situation" (as of 10th Bloomberg). However, "yen depreciation leads to high inflation, and borrowing increases with active fiscal policy . If interest rates are raised, government bond expenses will soar, making it impossible to budget. Before it becomes completely unmanageable, it is necessary to discuss shifting to "wise spending" " (August 20th Bunshun Online). His belief is to emphasize fiscal discipline, and excessive depreciation of the yen should be corrected. I hold the view that fiscal discipline is important, and excessive depreciation of the yen should be corrected.It is believed that he has intentions.
KoizumiMr. Koizumi's statements on economic policy are few, and in a sense, he may be considered to hold a neutral position.
Regarding the Bank of Japan's monetary policy, he stated in a TV program on the 11th, " respecting the independence of the Bank of Japan" (Nikkei newspaper, dated 14th). Regarding fiscal policy, he stated at a debate held in Kanazawa City on the 16th, " We must not hinder growth by focusing on the primary balance of the national and local governments."(As of the 16th, as reported by Jiji Press), is showing a pro-expansionary fiscal policy stance at this point. However, Former Prime Minister Junichiro Koizumi, his father, showed a fiscal reconstruction plan with a 'backbone policy' during his time as prime minister.There is a history behind this, and his statement on the 16th can also be seen as a comment showing consideration for the disaster-stricken areas.
What individual investors are concerned about is likely the stance on strengthening taxation on financial income such as capital gains from stock sales.
The trigger was, Ishibamentioned in a television program on the 2nd."I want to implement" regarding the strengthening of taxation on financial income.(As of 2nd, Reuters communications) mentioned.
In response to this,KoizumiMr. said, " The Japanese economy is finally shifting from savings to investment. This is not the time to discuss financial income tax that disrupts this momentum"(As of the 3rd, Sankei Shimbun) in opposition.
IshibaOn the 3rd, the person also...The target of tax strengthening is the "super wealthy" (As of March 3, Jiji Press), with a toned-down approach.As of March 3, the tone has been toned down according to Jiji Press.
Mr. Takai...Mr. Takai, when he ran for president in the 2021 election, advocated raising the tax rate from 20% to 30% for annual financial incomes of over 0.5 million yen after achieving the inflation rate of 2% which is the stable price target (Nikkei of September 13, 2021).However, at that time, the inflation rate was far from 2%, and there was not as much momentum towards a shift from saving to investment as there is now, making it uncertain how serious the proposal was at the time, and whether the same idea persists today.During this presidential election, there have been no reports of Mr. Takai's comments on taxing financial incomes.During this presidential election, there have been no reports of Mr. Takai's comments on taxing financial incomes.It seems so.
- Moomoo News Mark
Source / Reference: House of Representatives, various government agencies hp inc, official websites of each candidate, Nikkei business daily, Bloomberg, Reuters, Sankei Shimbun, Jiji Press, Bunshun Online
Source / Reference: House of Representatives, various government agencies hp inc, official websites of each candidate, Nikkei business daily, Bloomberg, Reuters, Sankei Shimbun, Jiji Press, Bunshun Online
Disclaimer: Moomoo Technologies Inc. is providing this content for information and educational use only.
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NAOKI1116 : I can only tolerate Shiho.
syunran : Short-lived administrations are a factor of economic instability. All three leaders, how long can they maintain their unstable foundations? Under the new US president, I think they will move towards a policy of a weaker dollar.
Perhaps Mr. Takahichi with his proactive fiscal policy.
にくQ : I wonder what will happen...