Sunday, April 3, 2011

Donations are Worthless, economic issues and the future of Japan

Did I say worthless? No, I meant worth – less (2 words), so put the torches and pitchforks down.

On April 2, the “Dram for Japan” event was held in New York City’s Ward III bar and nightclub, generating a few thousand dollars (I haven’t seen the final figures yet) for the Japan Society Earthquake Relief Fund, organized by a group of very capable entities, including Teleport City’s own Keith Allison. I was happy to donate what I had available to the items that were auctioned off (give them a good home whoever you are) and I also had the chance to sample some very interesting distilled whiskey products including some selections from a distillery in New York hopefully to be featured on Pinky Mixology in a future episode.

It was a nice time and we raised money for a good cause, but this revelry occurred under a cloud so immense and so entrenched in permanence that it went almost completely unnoticed save for a passing mention by a ninja consultant. That is the monster of currency stagflation and what it’s doing to the Yen. To get a picture of it, you can look at this previous post, and since I’ve talked about it before, I won’t cover the entire matter again, but only reference it in order to point out that there now exists a serious potential to finally equalize the yen. It’s no guarantee, but at least it’s real.

At the moment, foreign currencies are quite weak against the Japanese Yen, which means that basically for every $100 you raise for earthquake relief it will basically just buy lunch for 4 guys after the exchange rate kicks in. Yet this current ratio of conversion can not stand forever, and will either be let down gradually in a controlled manner to minimize damage, or eventually progress to the point it triggers a major upheaval or worse, a collapse. It is in the potential ability to facilitate this controlled adjustment that we can (possibly) find a silver lining in the Tohoku/Sendai Earthquake, if one can call it that.

This event will serve as the impetus of action by the BOJ, to release unexpected (or at least unplanned) amounts of currency into the economy, resulting in a flood of JPY into the local and a subsequent inflation that is very desperately needed. In a perfect (aka economically balanced) world, that would be all it would take, however Japan is in a spot best described as being between a rock and a hard place. The country will release a flood of funds but have limited means to implement the programs it hopes to accomplish... leading to an influx. This influx can either be: A) workers not from Japan but willing to work and live in such a country, or B) a mythical number of Japanese which do not exist, willing to work and live in such conditions as the USA forces Mexicans to tolerate. Seriously, in Japan even whitey is an outsider, and given the sociological problems Japan is having right now, this is the literal last straw.

Will Japan lose some culture and history? No, not really. The country has let millions of non-Japanese through over the pre-Meiji era, and the culture it fears losing has been defined after such occurrences. As long as they can get enough money and public support behind the idea of what their culture is, it will never go away.

So we shall see a great acceleration in the formula that was “Japan Inc.” to all of us early otakus and academics... But now that the snow globe has been shaken up... hopefully Japan is ready for a restructuring of that level, which requires foreigners to rebuild many sections of Japan, but this time thedy will stay and there is nothing that can be done.

No comments: