Thursday, January 17, 2013

From All Sides Now

The negative reviews of Abenomics keep pouring in. So numerous are the voices raised in protest that the objections come now in all kinds of flavors:

- Clyde Prestowitz's MOSS ("More Of the Same Stuff" - Link) highlights one of the most infuriating aspects of Abe Shinzo's economic program. Abe & Co. have a supermajority in the House of Representatives, a four year mandate, a despised and divided opposition...and all they can come up with as plans for pulling Japan out of chronic deflation and low growth are a public works spending-heavy fiscal package and stripping the Bank of Japan of its independence. ARE YOU KIDDING ME?

(How egregious is the assault on the Bank of Japan? No one has raised a peep about Abe smothering the Financial Services Agency by handing the Agency portfolio to Finance Minister Aso Taro. Perhaps new Abe advisor Takenaka Heizo can suggest that a de facto reversal of the bust up of the old Finance Ministry* is a Really Bad Idea.)

- Following up on the suggestion that Dr. Noah Smith made almost three weeks ago -- that Abe Shinzo's real goal in roughing up the BOJ is to drive down the value of the yen (Link) -- Bank Rossii First Deputy Chairman Alexei Ulyukayev has declared the world on the brink of a "currency war." (Link)

It seems than goosing the profits of exporters through currency manipulation, indirect as that manipulation may be, prior to the March 31 end of the fiscal year, upsets folks in other countries.


- From domestic economists working for the research arms of financial giants, an assessment that the Abe fiscal stimulus package will create far fewer jobs than promised (Link). I am trying to figure out why these staff economists would have a vested interest in denigrating the stimulus. At present I cannot see an ulterior motive.


* In the kind of precious slip of the tongue that only an old-fashioned pol in full smirk can deliver, Aso Taro, in his first NHK interview after being named Finance Minister, called the Finance Ministry the Okurasho ("Ministry of the Great Storehouse") -- the pompous archaism the MOF abandoned as its official name twelve years ago.

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