Posts Tagged ‘Japan’

the hazard of accented speech

Saturday, July 16th, 2016

The Financial Times invites Eddie Jones, hero to millions of Japanese rugby fans, for Sunday lunch in Tokyo.

The 56-year-old, who is half-Japanese and spent large parts of his career in Japan, is fresh from a triumphant tour of Australia. ….

[Without opening the menu, he orders] buttered scallops and a Cobb salad with no bacon. The waitress misses that last part. “Bacon nashi,” he says, using what he calls “rough, rugby Japanese”. His wife, a linguist and a Japanese national, has banned him from speaking this pidgin language at home, fearing that it will pollute their daughter’s Japanese and, worse, confuse the dog.

Leo Lewis, “Lunch with the FT: Eddie Jones“, Financial Times, 16 July 2016 (metered paywall).

Eddie Jones (born 1960 in Tasmania) is currently head coach of the England national rugby union team. He previously coached the Australian national and Japanese national teams.

Japan’s coming Greek crisis

Thursday, March 4th, 2010

Japan’s economy has been in recession since 1991. Government debt, even factoring in foreign exchange reserves, now exceeds 100% of Japan’s GDP. Moreover, the country in the near future faces labour shortages because of low birth rates and resistance to foreign immigration. Harvard economist Ken Rogoff, surveying this scene, finds everything in place for a fiscal crisis of Greek proportions. Such dire predictions for Japan have proven wrong in the past, though. Could it be that ‘this time is different’.

Although hardly in crisis (yet), Japan’s fiscal situation grows more alarming by the day. Until now, the government has been able to finance its vast debts locally, despite paying paltry interest rates even on longer-term borrowings. Remarkably, Japanese savers soak up some 95% of their government’s debt. Perhaps burned by the way stock prices and real estate collapsed when the 1980’s bubble burst, savers would rather go for what they view as safe bonds, especially as gently falling prices make the returns go farther than would be the case in a more normal inflation environment. ….

As the population ages and shrinks, more people will retire and start selling those government bonds that they are now lapping up. At some point, Japan will face its own Greek tragedy as the market charges sharply higher interest rates.

The government will be forced to consider raising revenues sharply. The best guess is that Japan will raise its value-added tax, now only 5%, far below European levels. But is it plausible to raise taxes in the face of such sustained low growth?

Investors who have bet against Japan in the past have been badly burned, grossly underestimating the Japanese people’s remarkable flexibility and resilience. But the fiscal road ahead looks increasingly perilous, with political consensus fraying badly in recent years.

Kenneth Rogoff, “Japan’s Slow-Motion Crisis”, Project Syndicate, 2 March 2010.

Kenneth Rogoff (1953-) is a former chief economist of the IMF. He is co-author (with Carmen Reinhart) of This Time is Different: Eight Centuries of Financial Folly (Princeton University Press, 2009).

H/T to Catherine Rampell at Economix.