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Shinzo Abe And The Three Magic Arrows
Submitted by Andy Sirkis via The Ludwig von Mises Institute,
Despite claims to the contrary in the mass media, Japan’s economy is continuing to suffer mightily under the leadership of Prime Minister Abe Shinzo. Abe is from a famous family and he’s a convincing talker, so he was able to bamboozle people into believing that he could make Japan prosper with his three arrows. These metaphorical arrows stand for “monetary stimulus,” “fiscal stimulus,” and “structural reform.”
When Abe was elected using his “three arrows” symbolism to attract votes, I thought the Japanese people were beginning to believe in magic. Perhaps they were gullible or a little lazy in thinking or thought they would receive “free stuff” from Abe. No matter, Abe became Prime Minister in December 2012 and shot off his arrows.
With his “monetary stimulus” arrow, Abe arm-twisted the central bank into doubling the money supply in just a few months time. I could just imagine Abe rubbing his palms together and fiendishly muttering “We’re going to be rich, rich, RICH!” All that the central bank had to do was type a few numbers into their computers to make this happen. Naturally, the newly created money was distributed to politically powerful banks.
How did all of this money creation affect the common people? Despite claims that Japan has less than 2 percent inflation, I can assure you that the prices of many goods, especially imported goods like energy, have increased dramatically since the monetary stimulus arrow was fired. Wages, on the other hand, have remained depressed. With higher expenses to pay, Japanese people can’t afford other goods they would like to buy and businesses can’t afford to raise wages, hire, or expand. Only Abe’s bankster friends have profited from this scheme by speculating in the stock market with the counterfeited money that had been credited to their accounts with the central bank computer.
Japanese people are mostly smart enough to realize that typing numbers into a computer can’t make an economy strong, yet they just haven’t figured out that Abe’s monetary stimulus is nothing but a sneaky counterfeiting scheme.
At the same time as the monetary stimulus arrow doubled the money supply, Abe and his gang used their fiscal stimulus arrow to enormously increase spending on government works projects. Unlike capitalists who at least try to invest productive enterprises, the government allocates money based on pull and other political considerations. Wasting money on things like a new sewer system in Kiev, replacing the perfectly good Olympic stadium with an expensive new Olympic stadium, and handing out plum contracts for highways to nowhere will never generate a profit. Government investment is more like consumption, often creating a 100-percent loss.
These money-losing projects weigh heavily on the people. After all, they will have to pay for this waste in the form of higher taxes and higher debt service. Even if by some miracle the fiscal spending created a profit, the money wouldn’t be distributed to the taxpayer. Heads you lose, tails you lose.
Most Japanese people are smart enough to realize that investing in things that lose money can’t make an economy strong, yet they just haven’t figured out that Abe’s fiscal stimulus is nothing but a sneaky scheme to enrich his well-connected friends. After nearly twenty-five years and fifteen rounds of fiscal stimulus spending, you’d have to be totally bamboozled to still be a believer in this failed Keynesian claptrap.
To pay for his “fiscal stimulus” arrow Abe decided to raise taxes and take the money he needed by force. He raised car taxes and income taxes and he raised sales taxes by 60 percent, but he also announced plans to raise sales taxes by 100 percent. He is considering increasing taxes on married people and poor people. With each tax increase and threat of further tax increases, the economy has weakened further.
And what of Abe’s third arrow, “structural reform”? No one knows what this political slogan actually means. It sounds like some modern day form of Soviet era Glasnost, but there’s been no significant deregulation or loosening of government controls that have long stifled the Japanese economy. We do know that Abe has spent a great deal of effort making enemies with the neighbors. Effectively, Abe’s aggressiveness in foreign affairs is the real third arrow.
Abe has severely damaged relations between the peaceful and industrious Japanese people and their business trading partners in the neighboring countries of China, Russia, and South Korea. Business deals such as the effort to build a gas pipeline between Japan and Russia have been scrapped. Profitable trading in South Korea and especially China has been crushed by Abe’s undiplomatic actions. Via his confrontation with China and sanctioning of Russia, Abe has recklessly followed the dictates of the warmongering US government, all to the detriment of the Japanese people.
Abe’s arrows have been praised in the media by the economically ignorant, the politically motivated, and those who believe prosperity is parceled out by some all powerful shaman. However, the arrows, seen in the harsh light of reality, turn out to be counterfeiting schemes, “investing” in money losing ventures, taking money from the productive, and squabbling with the neighbors. These counterproductive political actions won’t ever result in a stronger economy and have instead left the Japanese people with a crushing debt and tax burden. Don’t get taken in by the hogwash you read in mainstream media propaganda pieces.
Abe’s policies are complete and utter failures.
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Before this nonsense started out, gasoline at the stand was selling for ¥138 per liter (about $5.21 per gallon USD). Yesterday I filled up the tank at the discount place and it was ¥159 per liter ($6.01 per gallon USD)... I think that's about a 13% increase.
By the way, some stands were selling gasoline for ¥167 per liter ($6.31 per gallon USD).
The cracks have begun to appear. To say that, "Abe’s policies are complete and utter failures" is an understatement.
they are fucked
Abenomics.
Three arrows; Excessive monetary stimulus, excessive fiscal stimulus and a buncha sophist bullshit thrown in for the Sound and Light Kabuki Theater.
Look at my held up hand... I had three magic arrows and the first two didn't work... So... um, now I have just one arrow left, and it is my middle arrow... and that's the one you'll be getting...
Abe’s policies are complete and utter failures.
Yep, but more importantly...
Obozo’s policies are complete and utter failures.
Mortimer Duke: Do you really believe I would have a *nigger* run our family business, Randolph?
Do not mistaken racists for realists...this is the realist playground.
Top, you are obviously an ignorant pig and most definitely part of the problem.
Abenomics is shooting arrows at deflation.
Deflation is shooting AR-15 rounds at Abenomics.
Six bucks a gallon?...hmmm.
Ah yes, Kuwait, Saudi Arabia, UAE and tadah!...Iraq.
http://www.eia.gov/countries/cab.cfm?fips=JA
Hat tip to Ned ;-)
If the people in japan wake up, they'll tie Abe to one of the 2600 exposed fuel rods at Fukushima. One can only hope.
When I read this, I found it odd. A casino law to stimulate tourism?
Does he want to change Japan into Las Vegas?
Who are these tourists? Who runs the casinos?
http://www.bloomberg.com/news/2014-06-24/abe-says-ldp-aiming-to-pass-jap...
The tourists would be:
the Chinese... no, they have money, but they hate Abe's Japan now
the Koreans... no, they have money, but they hate Abe too
the Russians... no, their oligarchs have money, but Japan isn't offering them any business right now
the European... no, they are both bankrupt and have casinos closer to home
the Americans... well, the American tourist might visit, but they have enough debts already to gamble even more, and they also have casinos at home
so that only leaves...
the JAPANESE: why yes, gamble away what you money you have left trying to get lucky, why not
exactly. and since the gambling japanese are already covered, that leaves no one.
maybe its purpose is to tax the Yakuza?
They could just invest that money instead of gambling with it....20 000 Dow or bust.
Dont only blame it on abe. Japan was heading towards that situation no matter what. You cant escape gravity.
Good for the japanese anyways, hopefully they can get rid of their fiat at the same time as their economy collapses to start from scratch with a sustainable and free peoples monetary system.
$6.31 / gallon? how do they get away with such cheap gas? I pay about $8.50 / gallon in Germany.
Same in Switzerland.
Same in Denmark
Same in oil rich Norway.
http://www.bloomberg.com/visual-data/best-and-worst/highest-gas-prices-c...
"Most Japanese people are smart enough..."
A large part of the education Japanese children receive in government schools is importance of respecting authority. After many generations since the end of the feudal era, this has become part of their culture. Japanese are extremely smart and they know what is going on. They just don't know how to complain about it. Look, if they could only make ineffective protests over the corruption surrounding Fukushima (before and after), what would you expect.
As for China and Russia, America admittedly runs Japanese foreign policy. As for South Korea, America also runs SK foreign policy. Oh, and Abe is an idiot nearly on par with America's own idiot.
In the States, we have the expression, "the squeaky wheel gets the grease."
In Japan, contrastingly, they have the expression, "the nail that sticks up gets hammered down." (Deru kui wa utareru).
Japanese culture (and most Asian cultures, really) are authoritarian and patriarchical - this stems from historical Confucian teachings on obedience. Like the Matrix, most Westerners can't really appreciate or understand just how authoritarian and patriarchical Asian cultures are from reading a book. They have to experience it for themselves.
If you were a Japanese everyman, and you ran around, telling your neighbors to make some noise because of your corrupt government and steadily eroding quality of life, you'd likely be shunned, ridiculed, ostracized, ignored, and worse. You'd be considered guilty of disrupting societal harmony and lack of patriotism.
By the way, Shinzo Abe is a Japanese neo-con. They want Article 9 abolished, they want the Senkakku Islands now, and they never met a war they didn't like, especially when others do the fighting and the killing and the dying for them. In this they are much like American neo-cons.
They do complain about...but only to their friends. Then they all sit and stew about it, much like Americans, and do little or nothing about it (the internet, as a safe place to vent frustration, is a boon for authority). There was a time in Japan when people took to the streets, assassinated people and generally brought these issues to the fore. No longer.
"Ninjas."
Whatever happened to the teenage mutant ninja turtles anyways? And who came up with that idea too...cuz it was real good.
Again...no expert (see comment below)...but to say Japan has some issues with nuclear stuff is like saying Abraham Lincoln had a problem making sure the job got done.
They'll have no problem venting their spleen when the time comes.
A man set himself on fire today, to protest the "self-defence" policy of the Abe government:
http://ex-skf.blogspot.nl/2014/06/ot-graphic-images-man-sets-himself-on....
quote:
"But I was more surprised to see some tweets (like this, and this, and this) accusing this man of carrying out an act of "terrorism" - setting himself on fire and thus endangering others on a busy street, when freedom of speech and universal suffrage are guaranteed [by the Constitution]."
Everything is upside down.
Have you ever seen Chinese riot? Pretty intense once it starts.
They are also pretty common in the provinces.
Chinese riot a lot more often than people in the west think, but they are equally quick to disperse as soon as they get something out of it. They are a practical bunch, the Chinese.
Conversely, whenever a Chinese riot comes to light to the western media, people fawn and swoon and swear it's going to be the 'downfall of the communist government', but it's actually pretty standard fair to them and don't carry much politics.
"If you were a Japanese everyman, and you ran around, telling your neighbors to make some noise because of your corrupt government and steadily eroding quality of life, you'd likely be shunned, ridiculed, ostracized, ignored, and worse. You'd be considered guilty of disrupting societal harmony and lack of patriotism."
Sounds exactly like the rest of the west to me ;) (Yep I do understand your point btw - just having a bit of a fun)
you'd likely be shunned, ridiculed, ostracized, ignored, and worse.
Sounds like what the US MSM does to you if you criticise the Obozo Admin.
They just delete your comments since they are big believers in freedom of speech...but not in the freedom of other people to hear you.
Mostly in order, except I don't know WTF is that part about the Senkakus supposed to mean.
Shitzo Abe is about as qualified torun a country as William Agee and his little blondie blow job queen Mary were qualified to run Bendix
Damn, Nozzle
Good memory. That sure dates us.
LOL
BTW, I think my neighbor has a Shitzo dog?
Oh that fucking asshole!
There's no free lunch, no free money printing, no costless tax increases, no costless foreign belligerency, and no costless king or prime minister. But, the gullible as always hope, but in the end must pay the piper.
Abe's kamikaze economic policy, a US Federal Reserve production.
"Abe’s policies are complete and utter failures."
Abe's policies are the U.S. policies- which are complete and utter failures.
Better policies would not have worked anyway. Japan is too far down the drain. Since in Japan, as in the West, the politics of illusions has taken over why not keep it going a while longer? Japan has a more resilient society, it won't be the first domino to fall. Now that the market, i.e. the thermometer of the economy, is broken, they can keep the illusion on, buying all the JGBs, then propping up the stocks. If the economy fails, it will be either because the Chinese bubble popped or the US recovery didn't materialize. Even better: Both! This will get us to 2015. After that, who cares?
Abe like many of our leaders is just another whore for the banking elite. And remember, Japan is still an occupied country. Abe does what he's told to do.
Abe will be remembered as one of the fathers of biflation. Prices spiral, wages tank
Crazy 3rd wave moves http://wavegenius.com/top-five-food-and-restaurant-stocks-in-wave-three-...
Sooner or later the reality is going to have to set in and Japan will have to be known as the land of the setting sun.
Overpopulated, under-resourced, aged, indebted and over governed. All the ingredients for an economic Fukushima.
maybe all true, maybe not. Some citaions to factual sources would be useful.
Despite claims that Japan has less than 2 percent inflation, I can assure you that the prices of many goods, especially imported goods like energy, have increased dramaticallysince the monetary stimulus arrow was fired. Wages, on the other hand, have remained depressed. Perhaps - or out of thin air. Source buddy
It's common knowledge for fucks sake, just read few recent articles on Japan posted here on ZH.
And bugger off with that bold formatting crap. There's nothing insightful or important about your comment that entitles it to prominence :-)
lol, classic response :-)
HAHAHA
Should have been "magic beans".
Shinzo is CFR. he's a whore. Everything he says publicly is bullshit.
Fuck you Shinzo-whore.
Japanese culture "it can't be helped"
xenophobia and an aging demographic are a bad mix. Japan is destined to become a museum before the end of this century.
They don't fear foreigners, they just like themselves, look at the wonders mexican growth has done for America and its bottom line.
Their demographics aren't a problem, unlike India or China, a stable or shrinking population is a good thing, you don't have to constantly invest (debt) in additional new water,sewer energy, housing school supplies........unless you poison a wide swath of the country with radiation, a declining population actually benefits society and frees up resources.
Imagine moving out of a 400 sq ft apartment into a 1200 sq ft apartment and having your rent cut in half, horrible huh?
Imagine the horror of petroleum imports dropping every year while the hydro is constant or increased with new dams every year.
Imagine having more surplus food to export every year, these horrors all come with declining populations.
As far as caring for the elderly, most care for themselves and work till they're dead, they got 87 year olds working rice fields and a thousand other jobs, not because they have to but because they enjoy hard work, and many self off themselves when they no longer can work.
They do have a Goldman Sachs problem with spending on stupid shit, easy to fix unlike Mexican invasion, which is unfixable. Japan's problem is America, and taking our monetary marching orders spend spend spend.
I guarantee if we go to war with Russia they jump ship and form an alliance, then start collecting on their US assets.
Indeed. The only people scared about the decline in births are the elite. For most everyone else it is a wise decision not to have children after two decades of economic decline.
You will know when the Japanese are righting the ship when the family becomes the center of Japanese life once again.
As with the Middle East I am by no means an expert nor will I ever be on Japan. Having said that I have studied in Taipei and have met a Japanese dude there. Once.
He looked like he was from Manhattan actually...with his leather briefcase and fancy blue suit and loafers. It made me laugh actually.
Anyway...that was a long time...just when the Nikkei was collapsing from it's all time high of 40,000 and the price per square foot on the Ginza district was the most valuable in the world by far.
Talk about a "Twin Towers." Those two came down too and have never recovered since.
Thus given this terribly limited view the best I can say is this: Japan has a lot bigger problems than "bad economic policies."
There is if I recall the Emperor correctly "issues of sovereign risk" here.
So while this article lays the ground work for a "Boogie Night" scenario quite well...my first impression is "dude...you're gettin a Hell!" and this only scratches the surface.
Given the alacrity of the situation I would say Abe has probably done about as well as can be expected for a politician. Having said that "the enemy has now made modifications and upgrades to Her Enterprise. And here she comes."
Duh. Next?
"Abe’s arrows have been praised in the media by the economically ignorant, the politically motivated, and those who believe prosperity is parceled out by some all powerful shaman."
And don't forget the largest and most important group of all, the fucking stupid.
"still be a believer in this failed Keynesian claptrap."
In the begiining when governments embarked on this debacle say pump a million into the economy NO BIG DEAL. They needed to collect the full 1 million within the credit period to avoid any interest.
No more passing on to future generation the interest on this ever increasing debt and also the inflationary costs = devaluation of their worth that goes with it.
Just imagine if this had been carried out this way instead and not for the gain and perpetual godhood of the 1%'ers.
What? ... no debt?
The three magic arrows - Bankers, Politicans and Media. All in the same bed and the same type of whores and parasites.
He just says, what the 99% of people without brain want to hear.
and the banks would be stupid, if they did not take the chance.
-the declining population is a benefit, not burden. and yes, in 2012 they sold more pampers for elderly, then for infants.
so what?
as somebody below contributed, this makes more living room , or smaller footprint. bad for bankers, good for common people.
When you introduce demographics into the picture we see that Japan is stuck with an aging and shrinking population that is evermore expensive for the government to provide for. Adding to its woes the Fukushima nuclear disaster has shuttered its nuclear power plants and forced the country to import more expensive energy alternatives.
Neither monetary nor fiscal policy will adequately solve Japan's problems. Continuing to run fiscal deficits only means that government debt is pushed onward and upwards leading to a variety of possible scenarios as to the what the end game will be. Simply put, the fundamentals for Japan are lousy. More on the downward path that Japan is on in the article below.
http://brucewilds.blogspot.com/2014/05/japan-sliding-towards-abyss.html
The nyc bankers are cramming that growth mantra down everyone's throats like a foie gras goose. Later they intend to eat our livers.
"Three arrows" huh?
He should wear one of those novelty thingies on his head that looks like an arrow going thru it. :-) or maybe THREE of them!
Apparently, not only Japanese people are willing to suspend disbelief in economic nostrums, especially when a whole team of sycophantic scumsucking economic commentators gets on board via the MSM. Recall the Greenspan/Rubin/Summers meme of "The New Economy" as the centrally managed currency exchange kept the dollar high enough to kill off a large part of the American industrial economy - to be replaced by "The New Economy." Looking at the labor participation rate in the US, "The New Economy" isn't meeting expectations.
Sadly, Tokyo is toast. Radioactive toast.
Three arrows are usually enough to finish someone off.
What "Structural Reform" = enslave populace and then default on sovereign debts they hold?
Why can't I have a printing press damn it.
Because you'll spend it on something useful
Please do not worry
Three arrows.......you mean like the ones on the Devil's pitchfork?