Japan Rocks World with Election Earthquake

The DPJ has won 300 seats in the 480-seat lower house, ending 54 years of almost unbroken rule by the Liberal Democratic Party. Watch yen for lots of hi-jinks.

Japan DPJ Election Win Brings ‘Bloodless Revolution Bloomberg
The Democratic Party of Japan swept to power for the first time as the nation’s voters turned their backs on half a century of single-party government that failed to reverse economic stagnation and spiraling welfare costs.

DPJ’s Nakagawa Says Japan Should Diversify Reserves Bloomberg
Japan’s opposition party, leading in polls ahead of next month’s election, said the nation should consider shifting its $1 trillion of foreign reserves away from the dollar and buying International Monetary Fund bonds.

Watch the Yen versus the Dollar.

Yen flies on election; China stocks drop Reuters

Meanwhile in the Euro zone:

Bankers watch as Swedish interest rates goes subzero CNN
The Swedish Riksbank entered uncharted territory when it became the world's first central bank to introduce negative interest rates on bank deposits.

Mervyn King, the Bank of England governor, has hinted he may follow the Swedish example as the danger of a so-called liquidity trap...