If you look through market history you will notice that in a lot of decades most of the average 10% return comes from a couple of great years. The 1990's were an exception for the US and the 1980's was an exception for Japan.
If this theory can hold water for Japan we may not see any big gains for a while. Following on with the two or three big years a decade theory, Japan was up a lot in 1996, 1999, 2003 and 2005.
Further, if you buy into the notion that the stock market is a leading indicator of the economy it is possible that 2003 and 2005 were pricing in whatever positive might be coming for Japan’s economy that so many people have been talking about.
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