Response to the Ishiwari Policy

If there are negative elements, strengthening financial income taxation, putting out the fire of income/corporate tax hikes, and a clear statement of succession to the Kishida line from savings to investment, the first time next week is probably a place to buy, and if not, it's probably a place where it's one step lower. The Kishida route, which includes wage increases → overcoming deflation, and investment promotion through NISA, etc. is highly evaluated by overseas investors. Additionally, if there is communication with the market about suppressing exchange rate volatility = the Bank of Japan's interest rate hike policy, evaluations from overseas will increase further. There seem to be many investors who say that the volatility of yen is too high to invest in Japanese stocks.

(Excerpt below)

Kevin Zau of Advent Capital Management

I was a little surprised that Mr. Ishiwari would be elected as the new president because according to the Shimouma review of the new president seemed to be the least likely of the three final candidates. The view of a person involved in the financial market was not very favorable to Japanese stock investors, etc., of fiscal reconstruction through corporate tax rate increases, expansion of capital gains taxation, etc., and normalization of monetary policy. In other words, it was expected that the opposite economic policy from Prime Minister Kishida would be introduced. That's why the Nikkei Average plummeted in the futures market.

However, Prime Minister Kishida also opposed the Abe Shinzo administration's economic policy “Abenomics” when he first took office, but then adopted policies closer to Abenomics, such as introducing a new NISA with the aim of becoming an asset management nation. I would like the new governor Ishiwari to shift from the economic policy he had insisted on until now to a policy that places more emphasis on capital markets. Fiscal reconstruction can only be realized when there is economic expansion.

I want them to take not only slogans, but also specific measures to revitalize capital markets. Mr. Ishiwari emphasizes that “all policies are fair and impartial to all.” For example, NISA is truly useful for fair and impartial asset management for all, and I definitely want them to continue the asset management-oriented policy.

In addition to the digitalization of medical information, which is lagging behind in Japan, residential real estate information is relaxed in order to universalize and make it more transparent, residential real estate sales will also become more active.

It is likely that Mr. Ishiwari, who has a long track record as a politician regarding Japan-US relations and Japan-China relations, which are diplomatic issues, will build relationships in a peaceful manner.

Although the Nikkei Average softens once due to concerns about capital gains taxation, etc., it is expected that it will turn upward once specific policies come out.