(The Diet Building in Beige, Tokyo)PREDICTIONS AND ACTIONS
In 1990’s, Japan experienced a real-estate market crisis as its total real-estate value reached $20 trillion (2000 trillion yen) including all its territory.
( http://www.news.janjan.jp/government/0606/0606035429/2.php)
Compared with it, the present U.S. crisis can be more reasonably quenched down.
That is why American elite must listen to EEE Reporter and Japanese non-nonsense pundits as well as news reporters in addition to CEOs of Japanese banks and stock companies.
SECTION I: JAPAN'S REGIME CHANGE EXPECTED
American experts anticipate that Japan is going to lose political stability, according to a late-night TV news report in Japan.
(These American experts must be obtaining information on Japan from the EEE Reporter blog, directly or indirectly.)
It is because Japan’s new Prime Minister Mr. Taro Aso of LDP to be elected tomorrow is expected to hold a snap election within a month.
It is because his popularity is expected to be kept high only for a month after his inauguration, and every national lawmaker of the ruling parties, the LDP (with 303 seats among total 480 Lower House seats) and the New Komeito Party (31 among 480), apparently wants to save his or her own seat through the early general election, no matter how the ruling parties as a whole will lose their seats, since nowadays the opposition Democratic Party of Japan (114 among 480) is gaining more support unlike the past due to the economic downturn and the widening economic gap in the society.
So, even though the LDP and the New Komeito Party can stay in power after the coming snap election, the gap in the number of seats in the Diet is expected to become smaller between the ruling parties and the opposition parties.
Inevitably, it is forecast that this instability will paralyze the Japanese Government as the Upper House of the Diet has been under control of the Opposition since last summer; accordingly, another snap general election will be requested by the general public who clearly demand the regime change this time so that the Democratic Party of Japan will come into power.
The key driving factor for this change is the denial of following the American way of money business and the American way of respecting the rich and the super-rich.
A majority of the Japanese people have come to think that the LDP has too much absorbed the American way of respecting money and rich people, and has widened the gap too much between the rich and the poor in the Japanese society.
After all, the gravest fact may be that the Japan’s ruling Liberal Democratic Party is unable to understand that it is the time to stop respecting Wall Street, in order to make Japan richer and greater.
If the LDP cannot understand the need for this paradigm change, it will lose power sooner or later, even if this conservative party narrowly wins the coming general election.
The right decision for the LDP must be to change their paradigm and stop respecting Wall Street and then hold a general election.
It is so, since the LDP might take a tumble from power in the coming snap election with a chance of 50% or more.
In that case, power in Japan will shift from the very pro-U.S. LDP to the moderately pro-U.S. Democratic Party of Japan.
SECTION II: JAPAN TO RESCUE WALL STREET
Japanese financial institutions are now busy trying to help, rescue, and take part in management of U.S. companies in the same trade:
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Nomura gets Lehman's Asia business
Clients query transfer of funds between European and U.S. arms
By Simon Kennedy, MarketWatch
Last update: 11:03 a.m. EDT Sept. 22, 2008
LONDON (MarketWatch) -- Japan's Nomura Holdings said Monday it's agreed to take over the Asia Pacific operations of U.S. investment bank Lehman Brothers and will offer jobs to all of the group's 3,000 workers in the region.
Nomura (NMR: 13.05, +0.05, +0.4%) (JP:8604: news, chart, profile) didn't give a price for the deal, but a person familiar with the transaction said earlier that it would pay $225 million for the business.
The Japanese firm said Lehman ( LEHMQ 0.19, -0.03, -14.0%) has been a strong player in the region in investment banking services, including mergers and acquisitions, execution services and prime brokerage transactions…
http://www.marketwatch.com/news/story/nomura-gets-lehmans-asia-business/story.aspx?guid={DC08792B-7E98-4AB5-B3B9-CD70B296638A}&dist=TNMKTW
Mitsubishi UFJ to buy up to 20% of Morgan Stanley
By Michael Kitchen, MarketWatch
Last update: 9:58 a.m. EDT Sept. 22, 2008
NEW YORK (MarketWatch) -- Mitsubishi UFJ Financial Group said Monday it has signed a non-binding letter of intent to buy between 10% and 20% of U.S. financial giant Morgan Stanley.
Mitsubishi UFJ (JP:8306: news, chart, profile) ( MTU, , ) , Japan's largest bank, said its total purchase would depend on the book value of the shares, as determined after conducting due diligence.
A subsequent press release by Morgan Stanley (MS: 27.09, -0.12, -0.4%) , however, said the letter of intent had the investment set to "eventually reach" the 20% level.
In its third-quarter earnings released last week, Morgan Stanley said its book value ran at $31.25 a share. This compares with its trading value, as of Friday's close, of $27.21.
A Dow Jones Newswire report said the Japanese megabank's investment would not be more than 900 billion yen ($8.4 billion).
Mitsubishi UFJ said that as part of the deal, it "would have the right to appoint at least one director to the board of Morgan Stanley."
http://www.marketwatch.com/news/story/mitsubishi-ufj-buy-up-20/story.aspx?guid={72D4C250-B658-4E87-A0C0-EBE26CBD39FE}
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Japan always helps the United States.
Japan has purchased U.S. treasury bonds as many as possible to help the U.S. Government in these decades.
But, this kind of facts has never been made public to the American society by the American power elite who always hinder American citizens from thanking, respecting, and loving Japan, for a special reason probably linked with a racial issue within the U.S. society.
SECTION III: NO GREAT DEPRESSION EXPECTED
Early this year, some American expert studied if another Great Depression would occur due to the subprime loan crisis.
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You see, Reinhart and Rogoff draw parallels between the current U.S. financial woes and five previous financial crises. All five of these were “associated with major declines in economic performance over an extended period:”
- Japan (1992)
- Spain (1977)
- Norway (1987)
- Finland (1991)
- Sweden (1991)
Of course, none of these are identical to the present 2008 USA, economically, culturally, or politically. However, when one takes a closer look, some of the major parallels are a cause for concern.
The Chronicle of Higher Education did just that. In reviewing the Reinhart and Rogoff paper, they focused on the parallels to the Japan crisis.
Like Japan et al., the United States has seen:
A steep rise in housing prices during the four years preceding the crisis. (The U.S. rise was more than twice as large as the average of the other five.)
A steep rise in equity prices. (Again, the U.S. rise was larger.)
A large increase in its current account deficit.
A decline in per-capita growth in gross domestic product. (In this case, the U.S. situation doesn’t appear as bad as in the five predecessors.)
An increase in public debt. (Here again, the U.S. situation isn’t as bad as in the historical examples – but Reinhart and Rogoff add that “if one were to incorporate the huge buildup in private U.S. debt into these measures, the comparisons would be notably less favorable.”)
The authors' conclusion:
“Given the severity of most crisis indicators in the run-up to its 2007 financial crisis, the United States should consider itself quite fortunate if its downturn ends up being a relatively short and mild one.”
(Click to enlarge.)http://bigpicture.typepad.com/comments/2008/02/5-historical-ec.html?pagewanted=all
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The higher you fall from, the harder you hit the ground and the more you will be injured.
The above study was performed before this turmoil in Wall Street involving Lehman Brothers and Merrill Lynch.
However, parties concerned now all seem to comprehend that it is dangerous to rely on the principle of the free market under the current situation.
What they need is control, regulation, and suppression to be applied to Wall Street.
If control, regulation, and suppression become the norm in Wall Street and the crude oil market, another Great Depression can be avoided.
But, most importantly, the U.S. Government must always consult Japan for any financial or monetary issue of such a scale as one or two trillion dollars as Japan is the greatest stake holder for the U.S., in order to avoid another Great Depression.
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That is all for today.
News reporters in Tokyo are busy nowadays to follow the change in power.
Formation of a new cabinet is expected tomorrow.
But, depending on near future situations, the new cabinet and the new Prime Minister will have a very short term of office, say, a month or so.
(There was a Japanese news reporter in the headquarters of LDP looking like Sherry, a Spanish wine:
http://www.fukuchan.ac/music/oldies/sherry.html )
Dan 9:20 And whiles I was speaking, and praying, and confessing my sin and the sin of my people Israel, and presenting my supplication before the LORD my God for the holy mountain of my God;
Dan 9:21 Yea, whiles I was speaking in prayer, even the man Gabriel, whom I had seen in the vision at the beginning, being caused to fly swiftly, touched me about the time of the evening oblation.
Dan 9:22 And he informed me, and talked with me, and said, O Daniel, I am now come forth to give thee skill and understanding.
Dan 9:23 At the beginning of thy supplications the commandment came forth, and I am come to shew thee; for thou art greatly beloved: therefore understand the matter, and consider the vision.