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Home Publications Blogs Beat the Press NPR Says Japan's Stock Market Fell in Response to Commitment to Stimulus, WSJ Says the Opposite

NPR Says Japan's Stock Market Fell in Response to Commitment to Stimulus, WSJ Says the Opposite

Tuesday, 22 January 2013 05:17

Morning Edition's top of the hour news segment (sorry, no link) told listeners that the Nikkei dropped in response to the Bank of Japan's commitment to support stimulus. The Wall Street Journal said the opposite, pointing out that the bank's asset purchase plans were quite modest. According to the WSJ, the decline in Japan's stock market and rise in the yen was due to the concern that the bank was insufficiently committed to stimulus.

Comments (3)Add Comment
written by JDM, January 22, 2013 5:01
I recently got some money which I've been able to invest, and so I've watched the markets lately. I learned over the past decade to ignore the cable news stock pundits, but I now also have seen that the vast majority (at least) of these post hoc explanations for why the stock market did whatever it did the day before are simply that: post hoc BS.

written by foosion, January 22, 2013 5:24
A move by the BOJ was widely anticipated. Markets had expected more. Compare news stories before with the results and see commentary (e.g., http://www.businessinsider.com...lop-2013-1).

Markets tend to move compared to expectations. This confuses people who see, e.g,. profits soared but stock tanks.

Usually, market expectations are not knowable, so post hoc explanations are BS. Moves by central banks, however, are easier to compare to expectations, given coverage, futures markets, etc.
What a pair
written by John Puma, January 22, 2013 10:06
I suggest, as a matter of policy, that one is safest to ignore BOTH NPR and the WSJ, on virtually ALL matters of importance.

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About Beat the Press

Dean Baker is co-director of the Center for Economic and Policy Research in Washington, D.C. He is the author of several books, his latest being The End of Loser Liberalism: Making Markets Progressive. Read more about Dean.