Japan’s GDP contracted by 1.6 percent in Q2 on a yearly basis, which wasn't as dismal as the expected contraction of 1.9 percent.

Looking somewhat deeper into Japan’s shrinking GDP growth number, we see overall exports fell by 16.5 percent on a yearly basis, of which exports to China fell during H1 of 2015 by more than 30 percent (in dollar terms). Please keep in mind China is Japan’s biggest trading partner and China’s imports from Japan are second to South Korea. Also, Japan is the third biggest economy in the world after the U.S. and China.

Interestingly, last week, Koichi Hamada, a key adviser Prime Minister Shinzo Abe said: “The magnitude of China’s shock is much larger than that from Greece, but we need not worry because always the effect of Chinese devaluation can be offset by monetary easing in Japan.”

Whatever officials say, we all know China is slowing down and will do whatever is necessary to avoid a hard landing. In this context, we shouldn’t be surprised the see the 7-handle against the dollar before year-end, which would represent a +10 percent devaluation of the Chinese currency. I really can’t imagine the Japanese wouldn’t weaken the yen to offset/compensate that.

Nevertheless, we probably won’t see huge moves in the yuan in one direction or another until after September when President Xi Jinping will pay a state visit the U.S. at the invitation of President Obama.

That said, there is no doubt the world is at risk of a real global currency war that is brewing and, if it starts (hopefully not!), will start in the Far East.

No wonder with Japan tanking we see oil prices, as well as WTI crude oil and Brent crude oil at more than six year lows, which is all deflationary!

Notwithstanding all that, there is still at this moment a lot of optimism about the eurozone and certainly now over the weekend Eurogroup has agreed to provide Greece its third bailout in the amount of 86 billion euros (about $95 billion) over 3 years while officially stating: “We are confident that decisive and as swift as possible implementation of the reform measures as spelled out in the MoU will allow the Greek economy to return to a sustainable growth path based on sound public finances, enhanced competitiveness, high employment and financial stability.”

Maybe some further interesting details, which markets don’t seem having understood yet are: “… Following the results of the Asset Quality Review and Stress Tests before the end of the year, the bail in instrument will apply for senior debt bondholders whereas bail in of depositors is excluded … Greece will target a medium-term primary surplus of 3.5% of GDP with a fiscal path of primary balances of -0.25% in 2015, 0.5% in 2016, 1.75% in 2017 and 3.5% in 2018… and last but not least … The Eurogroup considers the continued program involvement of the IMF as indispensable…”

Of course, wonders do happen…

That said, any long-term investor has the choice being optimistic or not. From my side, I’d prefer remaining with both feet on the ground and I will have to see it, which I hope for, before I’ll believe it.

In the meantime, on Friday we got disappointing GDP growth numbers for the eurozone during Q2 that came in overall at 0.3 percent, which was below the expected 0.4 percent, and (this is important!) with almost all of the larger economies, with the exception of Spain, performing worse than expected.

No doubt, the eurozone with its continuous economic growth problems is not out of the woods yet and so far, the ECB’s massive QE program, low oil prices and a weaker euro haven’t caused the cyclical upswing everybody is still waiting for.

Long-term investors could do well keeping in mind when we look at data provided by Eurostat, BEA and others, GDP of the eurozone is still more than 1 percent below its peak of 2008 and has grown, since 2000, at about half of the performance of the U.S. and the United Kingdom.