Katie Martin

What it means is that over time you take that allocation down.

And I know that's less dramatic and it might be somewhat less satisfying to some people, but that is the reality of it.

And it takes ages.

And I was just today speaking to a very large pension manager who was saying we're very conscious that we don't want to over-rotate.

We don't want to move too far out of the US.

We don't want to sacrifice the performance or find ourselves overly exposed to other small markets.

So...

You know, it's easy to forget, especially with some really large conservative investors, just how many investment committee meetings you have to go through to get to the point where you take a conscious decision to peel away from a big global benchmark.

It's really not straightforward.

It can take a really long time.

But I do feel like this is a durable shift in how global asset allocation works and that we will be looking back on this moment in 10 years time and thinking that was it.

That was the point at which the US started to lose its global centrality.

The Japanese bond market has, as I'm sure you know, for the longest time been aggressively boring.

sufficiently boring that genuinely some Japanese government bond trading floors have like mini golf set up on them, right?

It's just that nothing happens.

If you get a few slivers of a percentage point move in one direction or another, it's a huge drama.

Okay, so that era is over.

What we're seeing now is actually quite lasting inflation in Japan, which they've had the opposite problem for the

This is a difficult adjustment for the Japanese economy, for the Japanese population and Japanese financial markets to get used to.

And there is a suspicion that the central bank is slower than it might have been in raising interest rates to tackle that.