Is Japan set to surge?

The result of Japan's upcoming election could present investors with a golden opportunity.

Amid all the fuss about the US fiscal cliff, investors may be missing "another political drama with equally weighty implications", says Martin Mittelstaedt in Canada's Globe and Mail: Japan's election on 16 December. It looks as though Japanese voters "are going to make their biggest attempt to date to extricate their country from its deflationary predicament".

Shinzo Abe, the frontrunner, is an advocate of aggressive fiscal stimulus and unlimited monetary easing, with an explicit inflation target of 2%-3%, compared to the current 1%. He has pledged to ensure that the Bank of Japan (BOJ) does his bidding, "or he will rewrite the BOJ law to let him fire them", says CLSA's Nicholas Smith.

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