The oil future index has sharply dropped to minus and the global sentiment has been quickly moving to “stay away from energy industry” mood. What would come up as our main concern for Japanese? The impact on actual Japanese economy has been limited as the logistic system and the storage capacity for oil should not change dramatically. I feel the more serious impact would come to the financial and economy. People said that Japanese pension funds and other financial institutions have significantly relied on U.S market and some potion has been allocated to so-called “high-yield bond”, which is subject to the speculative projects like energy industry.
As a research said those bonds have consisted of those energy bonds or equities as well. At the end of March, and the beginning of this April, it was announced that the GPIF management team has been renewed. Probably, it has nothing to do with the oil price decline however, as a Japanese, the biggest concern would be the impact on our sentiment. What if people believe that pension scheme collapsed and less consumption and high saving mood spreads nationwide? This would be the same fundamentals that we saw after the Lehman clash.
https://www.ipe.com/news/gpif-announces-new-president-new-cio-to-follow/10044657.article
