Stephen Jen, from SLJ Macro Partners, said Japan was playing with fire by trying to reflate, warning that this could decimate the bond portfolio of Japanese lenders and set off a banking crisis. The banks hold government bonds worth 900pc of their Tier 1 capital. Mr Jen said the country would be the focus of attention this year as political fireworks shifted from the US and Europe to Asia. "There will be dramatic events in Japan," he said.