Pimco's Balls Sees Little Spillover If BOJ Moves on YCC

The transcript discusses the potential impacts of the Bank of Japan's (BOJ) policy changes on global financial markets, particularly focusing on the spillover effects from the European bond market to Treasuries. It highlights the expected move away from Yoko control by the BOJ and compares it to rate shocks from other central banks like the Federal Reserve. The discussion includes differing views on the sensitivity of hedge funds to these changes and the anticipated impact on Japanese Government Bonds (JGBs) and yields. The role of Japanese investors in global markets and the ability of these markets to absorb shifts in investment patterns is also explored.

Discuss the sensitivity of hedge funds to spillover effects from the BOJ's monetary policy changes.

What factors might lead to Japanese institutions owning more foreign assets over time?