Off the World News Desk:
"We have detailed the straitjacket into which the Japanese have been strapped for the past two decades numerous times in the last few years (in great detail here) but as Grant Williams leaned back in his most comfortable chair after reading an article about proposed changes to the GPIF (Government Pension Investment Fund), Japan’s public pension fund; the thought popped into his mind - "Japan really is totally f##ked." What led him to that well-thought-out and eruditely expressed conclusion? Read on...
In an interview with CNN’s Fareed Zakaria earlier this year, Abe explained the true significance of the third arrow:
“What is important about the third arrow, structural reform, is to convince those who resist the steps I am taking and to make them realize that what I have been doing is correct, and by so doing, to engage in structural reform.”
Read that again.
Yes folks, the important part of structural reform in Japan is to convince people that Abe is correct. If he can convince them he is right, they will have engaged in structural reform.
You should be.
This is how Japan works — or doesn’t.
Immigration reform has been widely recognized as the only answer to Japan’s crippling demographic problem for well over three decades. Nothing has been done about it..."
I can tell you from first-hand experience that nothing is getting better here ("better" in the sense that most people mean). Prices are higher, but incomes are not. Abenomics, like QE and everything else governments are trying, is just a time-buying device. Governments are trying to revive their moribund economies, but actually they have no idea what to do, so they come up with ways to buy time. Truly, duct tape would do just as well. There's one other thing I want to comment on here. We are told that Japan, like a number of other countries, has a demographics problem. The population is aging. There aren't enough people to work and pay into the pension system. So they should liberalize immigration laws and bring in more working people. Etc., etc. This coming from the great economic minds of our era. But this is drivel. Net energy is declining before our eyes. The solution, we are told, is more investment, more drilling, more tax breaks, more subsidies, more money printing, more incentives. But no matter what we do, energy just keeps costing more. It's because of this that economies are hitting the skids, and moving ever closer to contraction territory. That means fewer jobs, not more. It makes sense to want fewer mouths to feed. So smart governments — those that have a handle on the future — will welcome population decrease, and do everything possible to let their industrial economies decline as gracefully as possible. But let's have no illusions. There aren't many smart governments on the planet. Instead they will try to keep the current system going, which will result in a hard landing (i.e., collapse). Have a nice day! -- RF