Abenomics

I had four big topics in today’s links: Japan, China, Ukraine and Spain. I want to concentrate here on the two Asian countries over the European ones. The wage issue in Japan is an important one because it informs the policy choices in the…

My contention has been that the first two arrows of Abenomics gave the Japanese economy a short window to bring the Japanese labour market back to full employment, re-ignite wage gains, and institute structural reforms. In my view, Abe has…

Japan’s deflation problem is overdetermined – there are multiple causes at work, any one of which could account for the observed phenomenon. Those who have been following the debate can simply choose their favourite – balance sheet…

Brazil goes into a recession. Spanish GDP growth rebounds and outstrips German GDP growth. Gold rebounds to beyond $1600 an ounce. US GDP growth in Q2 and Q3 is below 2%. 10-year US Treasury yields fall below 2.25%. Abenomics ‘fails’…

"Most of the CPI effects of the Bank of Japan’s efforts to depreciate the yen remain confined to a relative price shock to food and energy that crowds out spending power elsewhere in the economy on future second-round effects in the absence…

Wage increases are vital for Abenomics - without them the current policies are simply unsustainable (see discussion). If consumers are squeezed (see post), spending will decline and the nation will face deflationary pressures once again.…

Abenomics is one of the most aggressive economic experiments we have witnessed in the post-Marshall Plan developed world. The questions is whether the massive stimulus campaign can work when politically there will always be discomfort with…

With Shinzo Abe’s radical economic policy shift now one year old, now is an appropriate time to look back and assess its effectiveness. I see results principally in asset prices and to a degree on inflation. However, it is not clear that…

Shinzo Abe is a smart man and savvy politician. He has the rare honor of being Japan's prime minister twice. He is celebrating his first year of his second (non-consecutive) term in office. In fact, it is on that very anniversary that he…

The danger of Japan's current policy (Abenomics) is that the outcome could turn out to be the exact opposite of what was originally intended. With wages stagnant, these import-driven price increases are hitting the Japanese consumer quite…