Is it sane to buy Japanese index fund like Nikkei 225?

It does not seem sane to buy Japanese stocks because the Japanese economy will have to deal with the raised consumption tax rate from the current rate of 8% to 10%. Or is it beneficial to support the Japanese economy?

Let alone the Consumption tax raise. The U.S. economy and possibly the world economy will suffer from the tariff hike set by the U.S. president, which will affect the Japanese economy as well, in a negative way, of course.

However, good news for a Nikkei buyer would be that the Bank of Japan is still willing to buy ETFs, including Nikkei 225. I looked at the data published by the Bank of Japan herself. I confirmed that She has been buying ETFs and REITs daily since 2010. To be precise, 151.8 billion Yens are spent on ETFs and REITs only this month between 1st June 2019 and 12th June 2019.

It probably is subjective, but I would say it is tremendous. I can presume that private sector and individual investors appear unwilling to buy Japanese ETFs because the price is not going up when the government is buying a lot of them.

The conclusion is that it is sane and logical to buy Japanese stocks because why do you not purchase Japanese stocks or ETFs when The Bank of Japan is willing to mitigate the risk of purchasing equities for you and supporting the market on a large scale.

One thing you should be careful about buying Japanese stocks is that, at the moment, it is hard to find the reason for buying them except for the current policy of the Central Bank of Japan. It is still safe to say the Japanese economy is stagnant, the ageing society is hopeless, and we do not have natural resources but Trees.