Japan's Money Power

The nation's cash pump supports equity and bond markets worldwide. What if it falters--or stops?

If global investors needed a wake-up call about the sheer power of Japanese money, they received a nasty one during the summer. During two weeks in July, the Dow Jones industrial average shed about 6% of its value, setting off tremors on bourses worldwide. At the time, market pros pinned the decline on disappointing corporate profits and fears of rising interest rates and a slowing U.S. economy. But 7,000 miles away in Tokyo lies another explanation.

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