Kyoto Report 2024 – 4
This Tuesday report will provide some insights into life for a westerner (me) who is working for an extended period at Kyoto University in Japan.
This category focuses largely on matters pertaining to Japan
This Tuesday report will provide some insights into life for a westerner (me) who is working for an extended period at Kyoto University in Japan.
This Tuesday report will provide some insights into life for a westerner (me) who is working for an extended period at Kyoto University in Japan.
The – Japanese National Institute of Population and Social Security Research – is the go-to place for understanding demographic trends in Japan. The latest revisions to the population estimates (as at 2023) show that the current population of 125.5 million will shrink to 96 odd million by 2060 and then 87 million a decade later. There is a rapid decline after that expected. The male population is shrinking faster than the female population. Much has been made in recent weeks of Japan’s slide down the GDP world ranking. First, China overtook it into 2nd place a few years ago and now Germany is moving into third place. India is projected to push Japan out of fourth place next year. Some have referred to this as “Peak Japan” with the population dynamics likely to push the nation further down the GDP table. There is a lot of anxiety among policy makers here about that ‘fate’. My perspective differs. In fact, I think that the challenge is not to solve the population decline but rather to work out ways to live well with a smaller population, and demonstrate to the world how a planned degrowth strategy can be achieved with minimal disruption to material security.
This Tuesday report will provide some insights into life for a westerner (me) who is working for an extended period at Kyoto University in Japan.
This Tuesday report will provide some insights into life for a westerner (me) who is working for an extended period at Kyoto University in Japan.
It’s Wednesday and I am mostly thinking about Japan today. In just over a week’s time, I will once again head to Japan to work at Kyoto University. I will be there for several weeks and will provide regular reports as I have in previous years of what is happening there. The LDP leadership struggle is certainly proving to be interesting and there is now a view emerging that the hoped for break out from the deflationary period has not happened and further fiscal expansion is necessary. This is at a time when the yen is appreciating and the authorities are worried it is making the external sector noncompetitive. That is, light years away from the predictions made by the ‘MMT is dead’ crowd when they saw the depreciating yen during 2022 and beyond. It just goes to show that trying to interpret the world from the ‘sound finance’ lens will generally lead to erroneous conclusions.
It’s Wednesday, so a few topics. Tomorrow, I plan to address the issue that the US economy is heading into recession. The short assessment is that it doesn’t look like it to me despite the relatively poor labour market data that came out at the end of last week. But there is certainly a lot of fluctuating fortunes being recorded around the globe at present. Recent Japanese data is quite interesting and I discuss it in what follows. We should also remember that yesterday was the anniversary of the Hiroshima bombing – a very sad day in human history. Constantly reminding us of the damage that the US bombing caused should warn us off war altogether and nuclear weapons and technology specifically. Unfortunately, the trends are working against such a view. And we also have some music to listen to while cogitating over those issues.
I am briefly in the UK (arrived Tuesday and returning to Melbourne early Friday). We are officially launching our new book – Modern Monetary Theory: Bill and Warren’s Excellent Adventure – later this morning at the UK MMT Conference in Leeds, England. I am avoiding many of the sessions to reduce Covid risk, given the lecture theatres do not seem to have been refitted with modern ventilation. But from what I can see the Conference is well attended and going well. I should add that I had nothing to do with the organisation of the Conference but as usual I thank those who have put time to build an event that focuses on the work that I am part of. Anyway, a whirlwind trip this time. Today, though I reflect on the latest developments in Japan with respect to its ageing and shrinking population and how that impacts on business viability and skill shortages. All part of my research on degrowth strategies.
In our new book – Modern Monetary Theory: Bill and Warren’s Excellent Adventure – which will be launched in the UK next Wednesday, we devote a chapter to what we refer to as the Japanese irony. This relates to the fact that while the conduct of policy in Japan is justified in mainstream terms, the more extreme policy settings that emerge produce outcomes that expose the deficiencies of the mainstream theories. At present, we are observing more examples of this. The latest matter of interest in Japan (from my watch) is the pressure the three megabanks are putting on the Bank of Japan policy makers to push up bond yields and interest rates. There is no reason based in financial stability concerns or community well-being for the Bank of Japan to agree to their demands. They just amount to special pleading from Japan’s fossil fuel financing megabanks for more corporate welfare to boost their profits.
Sometimes when I am reading some story or analysis about the economy I sense a sort of glazing over effect – I just read the words as they appear on the paper and it is not until after I have read the entirety that I sort of have to pinch myself and realise that this is an attempt at serious journalism. The realisation that I have just read the most extraordinary nonsense that one could devise to present to readers then sinks in. I then wonder how a journalist could be so stupid as to actually construct and article in that way and seek so-called ‘expert’ commentary from an array of highly paid economists and bankers to support the nonsense. Who are they trying to fool? Well almost everyone is the answer. Why does this sort of journalism continue other than the lurid headlines sell products and that is what journalism has really become? I don’t accept that all these characters are part of a massive conspiracy to deceive the rest of us. Obviously, some of the players know clearly that they are manipulating the truth to advance their own agendas – like when bank economists continually claim interest rates have to rise (which they know will just boost the profits of the companies they work for). But the better way of thinking about this mass deception is that we have all been captured by the fictional world created by economists, who themselves are mostly trapped by the Groupthink that is impressed on them during their university days. Whatever the explanation, it still amazes me how stupid we all are for accepting this nonsense as serious commentary.