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When The Advanced Keynesian Disease Afflicts A Nation—–Japan’s Abe Goes Full Fantasy-tard With 3 New ‘Arrows’
When The Advanced Keynesian Disease Afflicts A Nation—–Japan’s Abe Goes Full Fantasy-tard With 3 New ‘Arrows’
Having completed his militarist plans, Japanese Prime Minister Shinzo Abe appears to have gone full fantasy-tard with his latest “plans” for the demographically-dead and debt-destroyed nation. “Creating a strong economy will continue to be my top priority,” Abe said, a goal he has stunningly under-achieved as Japan heads for its 5th recession in 4 years, but, as Bloomberg reports, it is his new “arrows” of economic hope that has left analysts scratching their heads – 20% economic growth(when its gone nowhere for years), a higher birth rate (as theaging of the nation accelerates and interest in sex plunges), and allegedly a goose that lays golden eggs (well why not?). The collapse of Abe’s approval says it all about his ‘plan’.
As Japan heads for a Quintuple Dip recession…
Abe proposes three new policy pillars without tying them to his previous plan. As Bloomberg reports, it has left analysts scratching their heads…
Speaking Thursday after his reappointment as leader of Japan’s ruling party, Abe unveiled three new “arrows” of his so-called Abenomics plan — a strong economy, child-care support and social security. When he took office in 2012, he had championed another trio — monetary stimulus, flexible fiscal policy and structural reforms.
But with the new policies sounding more like objectives rather than measures to achieve them, the risk is this fresh framework muddies his communication battle to encourage Japanese households and companies to spend rather than save.
“Investors like details, but all he’s done is announce targets,” said Mari Iwashita, chief market economist at SMBC Friend Securities Co. in Tokyo. “The growth strategy, one of the original three arrows, has branched off into three new arrows.”
Speaking to reporters Thursday, Abe avoided mentioning monetary or fiscal policy, as well as tricky regulatory reforms that many economists say are already too slow. Instead, he focused on his new three objectives:
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Abe Reaches his Militarist Goal
Abe Reaches his Militarist Goal
Japan’s House of Councilors Briefly Transforms into Rada Outpost
Pictures such as those below used to primarily reach us from Ukraine’s Rada, back before Poroshenko’s “lustration law” banned about four million Ukrainian citizens from the political process forever. In Ukraine, brawls regularly broke out between Western Ukrainian nationalists and representatives of Eastern Ukrainian ethnic Russians.
Last week we received similar imagery from the upper house of Japan’s Diet, a.k.a. the House of Councilors.
A brawl breaks out in the usually quite reserved upper house of Japan’s Diet
Photo credit: Toru Hanai / Reuters
A few close-ups:
Alain Delonakawa dishes out an an uppercut
Photo credit: Yuya Shino / Reuters
Take that you bastard! Lawmakers are piling on in scrum-fashion
Photo credit: Yuya Shino / Reuters
So what has happened? Why are Japan’s notoriously consensus-prone and bushido-inhibited lawmakers suddenly trading fisticuffs and one presumes, matching verbal insults?
Dulce et Decorum est pro Patria Mori?
As our long-time readers know, we have posted a portrait of Japan’s nationalist-socialist prime minister Shinzo Abe a while back, entitled “Shinzo Abe’s True Agenda”. In brief: “fixing” Japan’s economy with even more inflation and deficit spending is only a side-show for Abe. He is convinced that he has a quasi-divine mission to bring Japan back to its glorious militaristic past. In this, he appears to be influenced by the philosophy of his grandfather Nobusuke Kichi, who actually served as a minister in Japan’s war cabinet during WW2 and became prime minister in the late 1950s.
Short Term Gains And Long Term Disaster
Short Term Gains And Long Term Disaster
About a month ago, Japan’s giant GPIF pension fund announced it had started doing in Q4 2014, what PM Abe had long asked it to: shift a large(r) portion of its investment portfolio from bonds to stocks. No more safe assets for the world’s largest pension fund, or a lot less at least, but risky ones. For Abe this promises the advantage of an economy that looks healthier than it actually is, while for the fund it means that the returns on its investments could be higher than if it stuck to safe assets. Not a word about the dangers, not a word about why pensions funds were, for about as long as they’ve been in existence, obliged by law to only hold AAA assets. This is from February 27:
Japan’s GPIF Buys More Stocks Than Expected In Q4; Slashes JGBs
Japan’s trillion-dollar public pension fund bought nearly $15 billion worth of domestic shares in the fourth quarter, more than expected, while slashing its Japanese government bond holdings as Prime Minister Shinzo Abe prods the nation to take more risks to spur economic growth. The bullishness toward Japanese equities by the Government Pension Investment Fund, the world’s biggest pension fund, boosted hopes in the Tokyo market that stocks have momentum to add to their 15-year highs.
GPIF said on Friday its holdings of domestic shares rose to 19.8% of its portfolio by the end of December from 17.79% at the end of September. Yen bonds fell to 43.13% from 48.39%. Adjusting for factors such as the Tokyo stock market’s rise of roughly 8% during the quarter, GPIF bought a net 1.7 trillion yen ($14 billion) of stocks in the period, reckons strategist Shingo Kumazawa at Daiwa Securities. GPIF’s investment changes are closely watched by markets, as a 1 percentage-point shift in the 137 trillion yen ($1.15 trillion) fund means a transfer of about $10 billion.
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Bank Of Japan Warns Abe Over “Fiscal Responsibility” While Monetizing All Its Debt | Zero Hedge
Bank Of Japan Warns Abe Over “Fiscal Responsibility” While Monetizing All Its Debt | Zero Hedge.
If one were to look up the definition of hypocrisy, the image of BoJ head Kuroda should be front-and-center. Having tripled-down on his money-printing and ETF-buying largesse just last week, he came out swinging last night at the government’s fiscal irresponsibility blasting Abe’s policies by saying Japan’s fiscal health “is the responsibility of parliament and the government, not an issue for the central bank to be held responsible for.” Aside from the fact that he is directly monetizing all JGB issuance – thus enabling Abe’s arrogant fiscal stimulus plan (by issuing 30Y and 40Y debt),Bloomberg notes that “Kuroda is making it crystal clear the government has to tackle the debt problem and if fiscal trust is lost that’s not going to be on the BOJ.” The world has truly gone mad.
Seemingly paying the same lip-service as Bernanke and Yellen in the US and Draghi in Europe, BoJ’s Haruhiko Kuroda is carefully positioning the blame for lack of growth and economic chaos on the government’s lack of growth-oriented policies… and not the central bank’s enabling experiments…(via Bloomberg)
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