When Hiroyuki Kubota hosted a boat party for Japanese government bond traders and strategists again last fall after a hiatus of several years, there was reason to celebrate.
The veteran group was suddenly back in fashion. The world’s top hedge funds had turned their attention to reversing the Bank of Japan’s ultra-loose monetary policy, shaking up the once-sleepy hinterland of global finance by hiring a steady stream of traders with inside knowledge of Japan’s government debt. Volatility in the ¥1.142 trillion ($7.1 trillion) Japanese government bond market surged to levels not seen since the 2008 financial crisis.
The group, made up of mostly Japanese-speaking men in their 50s and 60s, was so engrossed in conversation that few dared to venture out onto the deck to admire the Tokyo skyline, said Kubota, a former JGB trader who started the nearly annual event in 1998 with members of his online chat room for government bond traders.
