NIKKEI 225: FROM OCCUPIED JAPAN TO THE 2026 ALL-TIME HIGH — THE COMPLETE STORY OF THE WORLD'S LONGEST STOCK MARKET RECOVERY AND THE $500 BILLION CARRY TRADE SITTING UNDERNEATH IT
Published: May 11, 2026
Source: Capital Street FX Research Desk
Full analysis: https://www.capitalstreetfx.com/daily-blog/nikkei-225-history-bubble-crash-carry-trade-2026/
THE HEADLINE NUMBERS
On May 7, 2026, the Nikkei 225 closed at 62,833.84 — posting its largest single-day point gain in history: 3,320 points in one session, driven by US-Iran peace deal optimism and five trading days of accumulated buying pressure from closed Japanese markets.
The index that began life in 1949 as a three-digit number scratched together from the rubble of occupied Japan has now more than doubled since it finally erased its 1989 bubble peak in February 2024. It took thirty-four years and three months. No major developed-market index has ever waited longer to recover from a peak.
Key data as of May 7, 2026:
Nikkei 225: 62,833.84 — ALL-TIME RECORD HIGH
TOPIX: 3,840.49 — up 3.00%
USD/JPY: approximately 144.80 — yen strengthening, BOJ intervention suspected
BOJ Policy Rate: 0.75% — highest since 1995, 6-3 hawkish vote split in April 2026
Japan CPI: 2.8% YoY — BOJ June hike now base case
Yen Carry Trade Outstanding: estimated $500 billion+ (Morgan Stanley) — partial unwind underway
10-Year JGB Yield: approximately 1.55% — highest in decades
Nikkei 1989 Bubble Peak: 38,915.87 — first eclipsed February 2024
This article covers the complete 148-year institutional history of the Tokyo Stock Exchange, the economic miracle, the bubble, the 34-year collapse, the Lost Decade, the carry trade era, the August 2024 crash-and-recovery, and what the current $500 billion carry trade means for every JPY pair and risk asset you trade.
PART I: THE TOKYO STOCK EXCHANGE — 148 YEARS FROM SAMURAI BONDS TO ELECTRONIC MILLISECONDS
To understand the Nikkei 225, you must first understand the exchange it lives on. The Tokyo Stock Exchange is not merely a marketplace. It is a direct chronicle of Japanese civilisation across three imperial eras, two world wars, an occupation, an economic miracle, the greatest asset bubble in modern history, and now a structural revolution in corporate governance that has drawn foreign capital back to Japan for the first time in three decades.
As of late 2025, the TSE lists approximately 3,943 companies with a combined market capitalisation of approximately $6.34 trillion — the third largest exchange in the world by that measure. Its history is the history of modern Japan rendered in prices.
THE MEIJI FOUNDATION (1878)
The district of Kabuto-cho in Tokyo's Nihonbashi ward takes its name from "Kabuto-zuka" — Armour Mound — a burial site from the Edo era built on coastal reclamation ordered by the Tokugawa shogunate. The connection between military power and financial power in that name proved permanent.
Japan in 1878 was in the middle of the most rapid voluntary modernisation in human history. The Meiji government, having watched Western imperial powers carve up Asia while Japan remained feudally isolated, had decided to industrialise at maximum speed. That required capital markets. It also required a mechanism to trade the government bonds issued to Japan's former samurai class — the kinroku kosai, salary bonds that compensated the warrior caste for the abolition of their hereditary stipends.
Finance Minister Shigenobu Okuma enacted the Stock Exchange Ordinance on May 4, 1878. Eleven days later, the licence was granted to a founding group that included Eiichi Shibusawa — Japan's most celebrated industrialist, later chosen as the face of the 10,000-yen banknote. Trading commenced on June 1, 1878, with four listed stocks and five types of government bonds, auctions conducted using a hinawa — a burning rope — as the time limit per session. The exchange opened 87 years after the New York Stock Exchange was founded under a buttonwood tree.
WARTIME, OCCUPATION, AND CLOSURE (1937-1949)
In June 1943, the government completed a forced merger of all eleven regional Japanese stock exchanges into a single semi-governmental entity: the Japan Securities Exchange. The purpose was explicit — to channel capital toward war production under centralised direction. Floor trading was suspended on August 1, 1945, four days before Hiroshima. Japan surrendered September 2. General MacArthur signed a directive on September 25 prohibiting all stock market activity.
The TSE building was occupied by General Headquarters of the Allied Forces from October 1945 until January 1948. For two and a half years, the largest financial institution in Japan's history functioned as office space for its occupiers. Securities companies, forbidden from formal trading, conducted semi-organised over-the-counter transactions on the streets around Kabuto-cho — informal markets that kept Japan's capital allocation alive at minimal scale through the deepest years of reconstruction.
THE REOPENING (MAY 16, 1949)
Under the new Securities and Exchange Act — modelled on the US Securities Exchange Act of 1934 — the Tokyo Stock Exchange reopened on May 16, 1949. Its first day was not triumphant: trading was thin, the economy was in ruins, and the index began at 176.21. But the institution existed again. The scoreboard was back on.
The Nikkei Stock Average — officially the Nikkei 225 — was introduced on May 16, 1949, calculated retroactively to May 16, 1949, using a price-weighted methodology modelled on the Dow Jones Industrial Average. The 225 constituents were selected from the First Section of the TSE: the largest, most liquid companies. Its opening value: 176.21.
PART II: THE ECONOMIC MIRACLE AND THE FIRST GREAT ASCENT (1949-1989)
OCCUPATION PEG AND RECONSTRUCTION (1949-1955)
Japan's postwar economic recovery proceeded under two constraints that paradoxically proved enabling. First, Article 9 of the Allied-imposed constitution prohibited Japan from maintaining offensive military forces, which meant that defence spending — which had consumed roughly 30% of GDP in the war years — was redirected into industrial investment. Second, the yen was pegged at 360 to the dollar under the Dodge Line stabilisation plan, giving Japanese exporters a fixed, competitive exchange rate against which to build.
Korean War procurement orders from 1950 provided the initial demand shock that kickstarted Japan's industrial revival. Steel mills, shipyards, and electronics factories that had been bombed or repurposed for occupation service were rapidly rebuilt and upgraded. Toyota's first US exports arrived in 1958. Sony's first transistor radios reached American consumers the same year.
THE ECONOMIC MIRACLE (1955-1973)
Between 1955 and 1973, Japan's GDP grew at an average rate of approximately 10% per year — a sustained pace of growth with no historical precedent among developed nations. The Nikkei 225 rose from 176 to approximately 5,000 over the same period, a 28-fold appreciation. The driving forces were: massive public investment in infrastructure, a deliberate industrial policy that channelled bank credit toward targeted export sectors (steel, shipbuilding, automobiles, electronics), a highly educated and disciplined workforce, and access to the vast American consumer market opened by the postwar alliance.
THE FIRST OIL SHOCK AND ADAPTATION (1973-1984)
The 1973 OPEC oil embargo hit Japan harder than almost any other economy: the country imported approximately 99% of its oil at the time. GDP contracted for the first time in the postwar period. The Nikkei fell sharply. But Japan's response was to aggressively invest in energy efficiency, shift its industrial mix toward higher-value-added exports (electronics, precision machinery, automobiles) that used less energy per unit of output, and accelerate its competitive advantage in quality manufacturing.
By the early 1980s Japan was running a massive trade surplus with the United States — particularly in automobiles and consumer electronics — and the trade conflict that would ultimately trigger the Plaza Accord was already building.
PART III: THE PLAZA ACCORD, THE BUBBLE, AND THE GREATEST MANIA IN MODERN FINANCIAL HISTORY (1985-1989)
THE PLAZA ACCORD (SEPTEMBER 1985)
By 1985, the US trade deficit with Japan had reached levels that American politicians and manufacturers considered intolerable. The Reagan administration concluded that the core problem was the dollar's overvaluation against the yen — a valuation sustained partly by high US interest rates and partly by perceived currency manipulation. On September 22, 1985, the finance ministers of the G5 nations — the US, Japan, West Germany, France, and the UK — met at the Plaza Hotel in New York and agreed to jointly intervene in currency markets to depreciate the dollar.
The Plaza Accord worked with shocking speed. The yen appreciated from approximately 240 per dollar before the accord to approximately 128 by 1988 — a 47% appreciation in less than three years. For Japanese exporters, this was an existential shock. Companies that had built their business models on selling goods priced in yen to customers paying in dollars suddenly found their products 47% more expensive in American shops.
The Bank of Japan's response was to cut interest rates aggressively — from 5% to 2.5% between 1985 and 1987 — to stimulate domestic demand and offset the export compression. This decision, combined with financial deregulation that had expanded credit availability in the early 1980s, created the conditions for the most spectacular asset price bubble in modern financial history.
THE BUBBLE (1987-1989)
The combination of ultra-low interest rates and abundant credit produced an extraordinary surge in Japanese asset prices across stocks and real estate simultaneously. Land in central Tokyo became the most expensive on earth — the land under the Imperial Palace grounds was estimated to be worth more than all the real estate in California. Japanese banks, their balance sheets inflated by the collateral value of real estate holdings, lent against those inflated values to fund further speculation. The circularity was the mechanism of the bubble.
The Nikkei 225 rose from approximately 13,000 in 1985 to a peak of 38,915.87 on December 29, 1989 — a 200% appreciation in four years. At peak valuation, the price-to-earnings ratio of the Japanese equity market exceeded 60x — roughly three times the historical average. The total capitalisation of the Tokyo Stock Exchange briefly exceeded that of the New York Stock Exchange, making Japan — with roughly 8% of world GDP — the host of the world's most valuable equity market.
The mood at the peak was one of absolute conviction. Japanese financial institutions were buying trophy real estate across New York, London, and Los Angeles. Japanese corporations were acquiring US entertainment studios and golf courses. The phrase "Japan as Number One" — the title of a 1979 Harvard sociologist's book — had become not just a description but a prediction that many Japanese believed would be fulfilled within a decade.
PART IV: THE COLLAPSE — 38,915 TO 7,603 IN 13 YEARS (1990-2003)
On January 4, 1990, the Bank of Japan raised interest rates. It was the first of five rate hikes that would push the policy rate from 2.5% to 6% by August 1990. The bubble could not survive positive real interest rates.
The Nikkei fell 39% in 1990 alone. It fell a further 26% by the end of 1992. And then something unprecedented happened: instead of recovering, as every previous equity bear market in modern history had done within a few years, Japan kept falling. Or rather, it kept failing to recover in any sustained way.
The mechanism of the prolonged decline was the debt-deflation trap. Japanese banks held massive portfolios of loans collateralised by real estate that had fallen 50-80% from peak values. The collateral was worth less than the loans it backed. But rather than recognising these losses — which would have required capital raises or bank failures — Japanese banks continued to roll the loans, receiving interest payments on debts that could never be fully repaid, and maintaining on their books a fiction of solvency that prevented the banking system from doing its primary job: allocating credit to productive uses.
This zombie bank phenomenon kept capital locked in dying companies and industries, prevented new entrants from competing, and slowly strangled Japan's capacity for the creative destruction that is the engine of economic renewal. The Japanese government responded to the growth slowdown with fiscal stimulus — approximately 10 major stimulus packages between 1992 and 2000 — that succeeded in preventing outright depression but failed to restart sustained growth, while accumulating the public debt that would eventually push Japan's debt-to-GDP ratio above 260%.
The Nikkei reached its ultimate post-bubble trough at 7,603 on April 28, 2003 — a 80% decline from the December 1989 peak. Thirteen years to fall 80%. And then another twenty years before the peak was recovered.
PART V: THE LOST DECADES — WHAT ZERO RATES, DEFLATION, AND DEMOGRAPHICS DID TO JAPAN (1991-2012)
The phrase "Lost Decade" applied to Japan in the 1990s eventually had to be revised to "Lost Decades" — plural — as the 2000s failed to deliver the recovery that had been expected. The period from 1991 to 2012 was characterised by three reinforcing structural problems that conventional monetary and fiscal policy proved unable to solve.
DEFLATION: THE SELF-REINFORCING TRAP
Consumer prices in Japan fell or stagnated for most of the period from 1999 to 2012. Deflation is not merely a statistical inconvenience — it is a behavioural trap. When prices are expected to fall, rational consumers and businesses postpone purchases and investment because the same money buys more goods tomorrow than today. This postponement reduces demand, which further depresses prices, which reinforces the incentive to wait. Breaking this cycle requires changing expectations, which requires sustained policy credibility.
Japan's attempts to generate inflation failed repeatedly because the Bank of Japan was seen as prioritising price stability over growth, because fiscal stimulus was repeatedly withdrawn before the recovery was established, and because the deflationary impulses from ageing demographics, technological deflation, and cheap Chinese manufacturing were too powerful for marginal policy adjustments to overcome.
DEMOGRAPHICS: THE HEADWIND THAT CANNOT BE STIMULATED AWAY
Japan's population peaked at approximately 128 million in 2010 and has been declining since. The working-age population (15-64) peaked earlier, in the mid-1990s. A shrinking and ageing workforce reduces the economy's productive capacity, increases the fiscal burden of social security and healthcare, reduces domestic consumption, and compresses the tax base from which government revenues are drawn.
Demographics do not respond to interest rate cuts or fiscal packages. They are the slowest-moving of all macroeconomic forces, but ultimately among the most powerful. Japan's demographic trajectory remains one of the most challenging in the developed world: the population is projected to fall below 100 million by approximately 2050.
THE BOJ AND UNCONVENTIONAL POLICY
Beginning in 1999 with the world's first zero interest rate policy (ZIRP) and continuing through quantitative easing from 2001, yield curve control from 2016, and the long-running Abenomics experiment from 2013, the Bank of Japan became the world's laboratory for unconventional monetary policy. Nearly every tool that the Federal Reserve and European Central Bank adopted in the aftermath of the 2008-09 financial crisis — zero rates, asset purchases, forward guidance — had been pioneered by the BOJ years earlier.
PART VI: ABENOMICS AND THE YEN-POWERED RECOVERY (2013-2020)
Shinzo Abe's election in December 2012 and the subsequent launch of "Abenomics" marked the most ambitious attempt yet to break Japan's deflationary stagnation. The programme rested on three "arrows": aggressive monetary easing (BOJ asset purchases at an unprecedented scale), fiscal stimulus (government spending targeted at infrastructure and social programs), and structural reforms (labour market flexibility, corporate governance reform, trade liberalisation through the TPP).
The monetary arrow was fired immediately and aggressively. Under new BOJ Governor Haruhiko Kuroda, the Bank expanded its asset purchase programme to double the monetary base within two years. The immediate market reaction was dramatic: the yen fell approximately 30% against the dollar between late 2012 and mid-2015, from approximately 78 to above 125. The Nikkei 225 more than doubled between late 2012 and mid-2015, rising from approximately 8,700 to above 20,000.
The yen depreciation was the primary transmission mechanism. A weaker yen directly boosted the yen-denominated profits of Japan's major exporters — Toyota, Honda, Sony, Canon — which translated into higher earnings, higher dividends, and higher share prices. Foreign investors, observing the combination of cheap stocks, improving earnings, and BOJ support, began returning to Japan for the first time in two decades.
The corporate governance reform — the structural arrow that received less attention — proved in the long run to be the most consequential. The Tokyo Stock Exchange began requiring companies trading below book value (where the market capitalisation is less than the net asset value of the company) to either improve returns to shareholders or face delisting pressure. This was a radical departure from the traditional Japanese corporate governance model, in which companies could indefinitely hold excess cash, maintain cross-shareholdings in allied companies, and resist shareholder pressure. The reform began attracting foreign activist investors and private equity, which in turn accelerated the corporate governance improvements the TSE was demanding.
PART VII: THE CARRY TRADE ERA — HOW CHEAP YEN REBUILT EVERYTHING THE BUBBLE DESTROYED (2020-2024)
The yen carry trade is the dominant structural feature of the current Nikkei rally and one of the most important structural risks in global markets. Understanding it is not optional for any participant in JPY pairs or risk assets.
THE MECHANICS
The carry trade is simple in structure: borrow in a low-interest-rate currency, convert the borrowed funds into a higher-interest-rate currency or higher-yielding asset, and pocket the interest rate differential. The profitability depends on two things: the interest rate differential (the "carry") and the exchange rate stability (if the funding currency appreciates against the investment currency, the appreciation erodes or eliminates the carry profit).
Japan's zero interest rate policy — maintained from 1999 through 2024 with only brief interruptions — made the yen the world's preferred funding currency for carry trades. The math was compelling: borrow yen at 0%, convert to US dollars, buy US Treasuries yielding 4.5%, and collect 4.5% annually as long as USD/JPY remains stable or moves in your favour. Scale this trade to institutional size — $500 billion in estimated outstanding positions according to Morgan Stanley — and you have one of the largest single structural positions in global financial markets.
THE NIKKEI CONNECTION
The yen carry trade is directly connected to the Nikkei rally through two mechanisms. First, foreign investors borrowed in yen to fund purchases of Japanese equities — a self-reinforcing dynamic in which rising equities attracted more carry-funded purchases, which further drove the Nikkei higher. Second, the yen depreciation itself boosted the yen-denominated profits of Japanese exporters, which made Japanese equities more attractive to foreign investors, which attracted more carry-funded purchases.
The Nikkei's journey from approximately 16,000 in early 2020 to 38,916 — the 1989 bubble peak — in February 2024 and then to 62,833 by May 2026 is inseparable from the yen carry trade. The index essentially doubled twice in five years, powered by the combination of improving corporate governance, record inbound tourism, a structural increase in global semiconductor and technology demand, and a $500 billion carry trade that mechanically channelled global capital into Japanese assets.
PART VIII: AUGUST 5, 2024 — THE LARGEST SINGLE-SESSION CRASH SINCE 1987
On July 31, 2024, the Bank of Japan raised its policy rate by 15 basis points to 0.25% — a small hike in absolute terms, but one that was accompanied by rhetoric suggesting further hikes were coming faster than markets had anticipated. The yen, which had been trading above 160 against the dollar (its weakest level in decades), began strengthening sharply.
The carry trade mathematics suddenly reversed. Borrowed yen were becoming more expensive to repay. USD/JPY fell from above 160 toward 142 — a 11% yen appreciation in less than two weeks. For carry traders who had borrowed in yen, every percentage point of yen appreciation was a percentage point of loss on the funding side of their position. The rational response — to unwind the trade by selling the invested assets and repaying the yen loans — is itself the mechanism that amplifies yen appreciation and asset price declines. This is the carry trade unwind in action.
On August 5, 2024, the Nikkei fell 12.4% in a single session — the largest single-day percentage decline since the 1987 Black Monday crash. The VIX volatility index surged to 65, its highest level since the COVID market disruption of March 2020. US technology stocks fell sharply on contagion from the carry unwind. The KOSPI (South Korean), Taiwan Stock Exchange, and ASX all fell in sympathy.
Then — with remarkable speed — the BOJ signalled it would not proceed with further rapid rate hikes given market instability. The carry unwind reversed almost as quickly as it had begun. Within a week, the Nikkei had recovered approximately 9%. Within a month, it had recovered to pre-crash levels.
The August 2024 episode is the single most important template for understanding the current risk in Japan. It demonstrated that: (1) the carry trade unwind can happen with extreme velocity; (2) the BOJ is highly sensitive to market feedback and will moderate its tightening path if markets react severely; and (3) the global contagion from a Japanese carry unwind is substantial — it affects US tech stocks, EM currencies, and the VIX directly.
PART IX: THE RECORD RUN TO 62,833 — WHAT DROVE THE NEW ALL-TIME HIGH (2024-2026)
The Nikkei's surge from 38,916 (the February 2024 recovery of the 1989 bubble peak) to 62,833 (the May 2026 all-time high) was driven by a confluence of factors that went well beyond the carry trade.
FACTOR 1: CORPORATE GOVERNANCE REVOLUTION
The TSE's sustained pressure on companies trading below book value — and the growing receptivity of Japanese management to shareholder returns as a legitimate business priority — produced a structural improvement in Japanese corporate earnings quality. Share buybacks reached record levels. Dividend payouts increased substantially. Return on equity, long a weakness of Japanese corporations compared to US and European peers, improved steadily. This made Japanese equities genuinely more attractive on fundamentals, not just on carry mechanics.
FACTOR 2: WARREN BUFFETT'S ENDORSEMENT
In 2020, Berkshire Hathaway disclosed stakes in five major Japanese trading houses (sogo shosha): Itochu, Marubeni, Mitsubishi, Mitsui, and Sumitomo. Buffett's investment — and his subsequent increases in those stakes — acted as a powerful signal to global institutional capital that Japanese equities deserved serious re-evaluation. The trading house stakes became one of Berkshire's best-performing positions, generating substantial returns as the companies increased buybacks and dividends.
FACTOR 3: SEMICONDUCTOR AND AI DEMAND
Japan is home to a world-class semiconductor equipment and materials industry — companies like Tokyo Electron, Shin-Etsu Chemical, SUMCO, and Advantest that produce the tooling and raw materials used across the global chip supply chain. The AI-driven surge in semiconductor demand from 2023 onward produced extraordinary earnings growth for these companies, which drove their share prices and contributed significantly to the Nikkei's advance.
FACTOR 4: INBOUND TOURISM BOOM
The combination of a weak yen and post-COVID travel recovery produced a record inbound tourism boom. Japan welcomed approximately 36 million international visitors in 2024, spending at record levels. This tourism spend directly boosted the retail, hospitality, real estate, and services sectors that had been depressed during the COVID years.
FACTOR 5: MAY 7, 2026 — THE RECORD SESSION
The specific session that produced the all-time high of 62,833.84 was driven by US-Iran peace deal optimism following five days of closed Japanese markets during the Golden Week holiday. The combination of pent-up buying pressure, positive global risk sentiment, and specific US-Iran developments produced a single-session gain of 3,320 points — the largest point gain in the index's 77-year history.
PART X: THE BOJ DILEMMA AND THE CARRY TRADE RISK
The Bank of Japan is currently caught between two legitimate but conflicting objectives. On one side: Japan's CPI at 2.8% YoY and a 6-3 hawkish vote split on the April 2026 policy board suggest that the conditions for continued rate normalisation are present — inflation is above target and the economy is growing. On the other side: the $500 billion yen carry trade is an extraordinarily large structural position that becomes systematically at risk every time the BOJ raises rates or signals further hikes.
The August 2024 episode established the BOJ's de facto communication rule: it can raise rates, but it must do so slowly and with careful market management, because an uncontrolled carry unwind would cause global financial instability that would almost certainly reverse the Japanese economic recovery the BOJ is trying to support.
This creates a dynamic where the BOJ is effectively being asked to raise rates at a pace that normalises Japanese monetary policy without triggering a carry unwind. Whether that is achievable is the central question for USD/JPY and for global risk assets in 2026 and 2027.
FOR TRADERS: WHAT THIS MEANS ACROSS YOUR POSITIONS
USD/JPY: The structural trend is toward yen strength as the BOJ normalises rates and the carry trade unwinds progressively. The pace of that normalisation is the unknown. Every BOJ meeting is a potential catalyst for a sharp yen move. The August 2024 template — where USD/JPY moved 12% in two weeks — sets the risk parameters.
Nikkei 225 (Japan225 in CFD markets): The index is at all-time highs but the structural support from the carry trade is simultaneously the index's greatest vulnerability. A rapid BOJ hike cycle that triggers a full carry unwind could reverse a substantial portion of the 2020-2026 gains very quickly. The corporate governance improvement is a genuine structural support that survives the carry trade, but it cannot offset a $500 billion unwind.
AUD/JPY: One of the most reliable carry trade proxies. When the carry trade is intact, AUD/JPY trends higher. When it unwinds, AUD/JPY falls sharply as investors simultaneously sell AUD (risk-off) and buy JPY (cover yen short positions). This pair is a direct risk-on/risk-off barometer for the carry trade.
CHF/JPY: Similar dynamic to AUD/JPY. Swiss franc is simultaneously a safe-haven currency and (since 2015) a lower-yielding currency that can itself be a carry funding currency. CHF/JPY is a complex but useful indicator of relative safe-haven demand.
Key support levels for Nikkei 225: 58,000 (recent breakout level), 54,000 (major structural support), 48,000 (pre-2026 ATH period).
Key resistance: 65,000 (projected extension), 70,000 (multi-year institutional target).
CLOSING NOTE
The Nikkei 225's journey from 176 in 1949 to 62,833 in 2026 is one of the most extraordinary investment narratives in financial history. It is simultaneously a story of economic miracle, of the most spectacular bubble and collapse in modern market history, of thirty-four years of waiting, and of a structural recovery driven by genuinely improved corporate governance, a global AI and semiconductor demand boom, and a $500 billion carry trade that is now unwinding in slow motion against a backdrop of BOJ rate normalisation.
The opportunity and the risk are embedded in the same structure. Understanding the full historical arc is not just intellectually interesting — it is the analytical prerequisite for managing exposure to any JPY pair or Japanese equity position over the next two to three years.
