Asset prices and exchange rates in the region are likely to face periods of both capital outflows and inflows as a result of global liquidity, financial conditions and major news events.
However, a close inspection of pessimists' three main concerns- overvalued asset prices, overinvestment and excessive bank lending- suggests that China's economy is more robust than they think.
Sound macroeconomic policies relate to sustainable fiscal and external balances, moderate inflation, low and stable interest rates, stable exchange rates and increasingly stable asset prices.
如今,非常规已经成为常规。这一代全球市场参与者只识低(甚至负)利率和人为抬高的资产价格。
Now, the unconventional has become conventional. A generation of global market participants knows only a world of low(or even negative) interest rates and artificially inflated asset prices.
More money in the system means lower interest rates means increasing asset prices, especially prices of assets that produce nice incomes, like Tokyo property.
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