Today, I watched with great interest “NHK World”, and their weekly program “Asia biz forecast”, found here:
Liquidity moves markets!Follow the money. Find the profits!
This week’s edition delved deeply into “Abenomics” and discussed how this latest attempt to drive Ms. Watanabe out of her financial foxhole is working.
Answer: not well.
Bonus Answer: and with other, unintended conseqeuences.
The “not well” part comes from the fact that the Japanese bond market is going through convulsions, with interest rates, and prices, whipsawing all over the place. However, the trend is UP on interest rates and DOWN regarding bond prices. The other “not well” part comes from the equally-as-wildly-gyrating Japanese stock market, which has gone into outright crash mode.
The “unintended consequences” part has to do with Japan’s export-driven neighbors: everyone from Thailand to Timbuktu is terrified that the sinking yen makes their economies vulnerable, and there is a full-blown currency war now underway in Asia.
(Spock Conclusion): There is nothing new under the sun. And “Abenomics” is nothing more than “Beggar Thy Neighbor” with a fancy name. The results are the predictable bond and stock market mayhem, and the attendant currency/trade war.
And what always follows a currency/trade war?
Fill in the answer here:______________
(P.S. while “NHK World” was discussing in depth the macro-economic issues, what was mainstream American media showing?: ABC’s “Good Morning America” featured a woman at a baseball game who was “cheated” out of catching a ball in the stands. I kid you not. This is why we are scroomed.)