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Economic Impacts

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Billions for Japan tsunami recovery went elsewhere, reports find

A crane this month sorts out rubble from the 2011 earthquake and tsunami at the collection site in northeastern  Japan. Some reports suggest the country's reconstruction efforts are set back by spending on unrelated projects. Credit: Koji Sasahara / Associated Press

Image: A crane this month sorts out rubble from the 2011 earthquake and tsunami at the collection site in northeastern  Japan. Some reports suggest the country's reconstruction efforts are set back by spending on unrelated projects. Credit: Koji Sasahara / Associated Press

latimesblogs.latimes.com - October 31st, 2012 - Emily Alpert

Billions of dollars meant to help Japan recover from its devastating tsunami went to government projects that had little or nothing to do with the disaster, a new spending review shows.

Japan - Fiscal Sustainability - Defying Gravity

economist.com - by R.A. - August 14, 2012

ONE of this week's new NBER working papers is a fascinating look at Japanese government debt, by Takeo Hoshi and Takatoshi Ito.

"Economic research has been accumulating overwhelming evidence against the fiscal sustainability of Japan. Many international financial institutions, credit rating agencies, and private-sector analysts agree over this assessment. Yet, the JGB interest rate has been low and stable. The 10-year JGB rate has been below 2% since 1999, and between 0.8% and 1.5% in the last few years. The rate is much lower than the bond rate of other advanced countries. This is despite the fact that Japan has a higher debt to GDP ratio than the European countries that have suffered from sovereign debt crises in the last two years—Greece, Ireland, Portugal, Spain, and Italy. JGB yield actually fell as the Japanese debt to GDP ratio increased in the 1990s and 2000s as Figure 3 shows. Why has the JGB yield not risen?"

(READ COMPLETE ARTICLE)

DEFYING GRAVITY:
HOW LONG WILL JAPANESE GOVERNMENT BOND PRICES REMAIN HIGH? - (63 page .PDF file)
http://papers.nber.org/tmp/78579-w18287.pdf

Three Reasons Japan’s Economic Pain Is Getting Worse

submitted by Samuel Bendett

bloomberg.com - by Jared Diamond - April 25, 2012

Japan’s economic problems are serious and getting worse. Foremost among them is the crushing burden of government debt.

Japan’s ratio of government debt to gross domestic product, currently about 2.28, is by far the highest in the industrial world, almost double that of even Greece and Italy, and steadily growing. Already, the combined costs of interest on that debt and social security are approximately equal to total government tax revenue.

(READ COMPLETE ARTICLE)

Health Uncertainties Torment Japanese in Nuke Zone

submitted by Samuel Bendett

      

Japanese Parliament Backs Noda as Prime Minister

by Hiroko Tabuchi - The New York Times - August 30, 2011

Haruyoshi Yamaguchi/Bloomberg News

Yoshihiko Noda, below, the new prime minister of Japan, and Naoto Kan, the outgoing leader.

 

TOKYO — Yoshihiko Noda, a down-to-earth fiscal conservative, was elected prime minister by the Japanese Parliament on Tuesday in the sixth change of leaders in five years, a period of mounting economic and social challenges to the world’s third-largest economy.

Japanese Prime Minister Resigns

The Sydney Morning Herald - August 26, 2011

                         

Japanese Prime Minister Naoto Kan has resigned as president of the Democratic Party of Japan, effectively ending his tenure as Japanese leader.

"I resign as the (party) president effective today," Mr Kan told senior party officials, Japan's Jiji press quoted him as saying today.

The long-expected move paves the way for the election of the nation's sixth prime minister in five years as Japan looks to safeguard a recovery from the March 11 earthquake, tsunami and an ongoing nuclear crisis.

A ballot for a new party president, who would then become prime minister, is expected on Monday.

Parliament will then vote the leader in as prime minister on Tuesday next week.

"I will leave the post of prime minister once the new leader is decided," Mr Kan said.

Mr Kan was scheduled to hold a press conference later today.

Japan Faces Costly, Unprecedented Radiation Cleanup

by Yoko Kubota - Tokyo - Reuters - August 25, 2011

     

(Reuters) - Nearly six months after the world's worst nuclear crisis in 25 years at the Fukushima nuclear plant, Japan faces the task of cleaning up a sprawling area of radioactivity that could cost tens of billions of dollars, and thousands may not be able to return home for years, if ever.

Fuel core meltdowns at the facility in March, triggered by a huge earthquake and tsunami, released radioactive material into the air which mixed with rain and snow and covered dozens of towns as well as farmland and woods, mainly along the northeast coast of Honshu.

Tokyo has been slow to provide a plan for rehabilitation, leading some residents near the plant exposed to high levels of radioactive caesium in homes and food, have started their own cleanup instead of waiting for the government to act.

Moody's Cuts Japan's Debt Rating on Deficit Concerns

BBC - August 23, 2011

The earthquake and tsunami caused widespread destruction to Japan's north-east coast.

Rating agency Moody's has cut Japan's long-term sovereign debt rating citing concerns about the size of the country's deficit and borrowing levels.

The rating was cut to Aa3 from Aa2, though Moody's also said the country's outlook was stable.

Japan has been trying to recover since the global economic crisis in 2009.

However, it was also hit by an earthquake and tsunami in March, and the rebuilding cost is weighing on growth and state finances.

"The rating downgrade is prompted by the large budget deficits and the build-up in Japanese government debt since the 2009 global recession," Moody's said in its statement.

"Over the past five years, frequent changes in administrations have prevented the government from implementing long-term economic and fiscal strategies into effective and durable policies."

Rice Futures Trigger Circuit Break in Tokyo Debut

Bloomberg - By Jae Hur and Yasumasa Song - August 7, 2011

 

An official from the Chiba Prefectural Government Offices shows a sack of rice samples bound for radiation tests at a field in Katori City, Chiba Prefecture, Japan.

Rice futures in Tokyo surged on the first day of trading after a seven-decade halt, triggering the bourse to suspend trade, on concern radiation from the stricken Fukushima nuclear plant may spread to crops and curb supply.

No deals were concluded on the Tokyo Grain Exchange after prices hit 18,500 yen per 60 kilograms from the opening, compared with the bourse’s reference price of 13,500 yen. The surge triggered trade to be suspended.

The exchange listed rice contracts today for the first time since the start of World War II to boost flagging volumes and profit. The resumption comes as fallout from the Fukushima Dai- Ichi power plant may spread after it was found cattle had been fed cesium-tainted rice straw.

Japan Nuclear Crisis: IAEA Report Finds Country Underestimated Tsunami Risk For Nuclear Plants

In this May 27, 2011 photo released by the International Atomic Energy Agency, or IAEA, members of the IAEA fact-finding team in Japan visit the Fukushima Dai-ichi nuclear plant in Okuma, Fukushima prefecture, northern Japan. (AP Photo/IAEA)

Reuters - June 1, 2011

TOKYO, June 1 (Reuters) - Japan underestimated the risk of tsunamis and needs to closely monitor public and workers' health after the crisis at the Fukushima Daiichi nuclear plant, a team of international safety inspectors said in a preliminary review of the world's worst nuclear disaster since Chernobyl.

The report, from an International Atomic Energy Agency (IAEA) team led by Britain's top nuclear safety official Mike Weightman, highlighted some of the well-documented weaknesses that contributed to the crisis at Fukushima when the plant, 240 km (150 miles) north of Tokyo, was hit by a massive earthquake and then a tsunami in quick succession on March 11.

Those start with a failure to plan for a tsunami that would overrun the 5.7-metre (19 ft) break wall at Fukushima and knock out back-up electric generators to four reactors, despite multiple forecasts from a government agency and operator Tokyo Electric Power Co's own scientists that such a risk was looming.

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