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Strategies & Market Trends : Asia Forum -- Ignore unavailable to you. Want to Upgrade?

To: Tony van Werkhooven who wrote (3450)	5/10/1998 4:27:00 PM
From: Stitch	Read Replies (1) \| Respond to of 9980

Hi Tony; <<just read that the water crisis is worsening in KL. How are you faring?>> We are getting water service for 12 hours out of 48. So far they have been fairly regular give or take an hour or two. During that 12 hours everyone in our neighborhood collects water to last the ensueing 36 hours so water pressure is very low. We collect approximately 320 gallons. We also purchase our drinking water. In each bathroom (we have 4) we have installed a Thai water jar which holds about 30 gallons each for dip baths. Outside we have 4 large barrels. We collect rain water in them when we can but rain has been scarce. We have about 40 potted plants that we have managed to keep alive but the lawn and garden are going to seed. I've purchased several industrial grade fire extinguishers. Construction in our development is brick, concrete, and tile roof however so we are reasonably safe that way. We purchase imported mineral water for drinking as we have no faith in the water authority here and are concerned about disease. As near as I can tell we are fortunate. I have a friend who is an expat from Finland that gets water for 1 hour each day and that only because his condo development buys it and has it tanked in. We have clothes washing parties here for him and another friend on those days we get water. We see stories of folks who have not had water service for several weeks with no promised end in sight. When I drive to our club I pass a place where there is spring water available. There are always several vehicles parked at the roadside and folks with containers collecting water. At the club we have closed the pool and sauna. Showers are available on an every other day basis so if I play golf on the off day, I go to a nearby men's spa who has contracted with a private water source. <<This weeks Business Week has a cover story on Japan's debt crisis.>> Japan is a very scary situation. Best, Stitch

To: Tony van Werkhooven who wrote (3450)	5/13/1998 5:38:00 PM
From: MikeM54321	Read Replies (1) \| Respond to of 9980

>>This weeks Business Week has a cover story on Japan's debt crisis. Provides a good (and scary) overview of the magnitude, both off and on balance sheet, government and corporate, and their inability to respond effectively.<< Tony, I read the long article and did this quick summary (it's short compared to the article!) for those interested. I'm referring to the cover story on the May 25th edition of Business Week. My summary in brackets: >>Just about everyone (Robert Rubin, Clinton, IMF, Malaysia, etc) all wanted Japan to do a massive tax cut Ronald Regan style. Market was expecting $120 billion in cuts. Instead Japan delivers only $34 billion. The Nikkei tumbles and the Yen gets weaker. Same old story. Well Japan says it won't do any good to cut taxes because Japanese people still won't spend our country out of recession. But it sounds like this reporter didn't buy this so he went and dug deeper. He came up with a lot of hidden "stuff." But the most significant beyond a doubt was the , "Fiscal Investment & Loan Program." Nickname, "Zaito." The reporter stated a bunch of other problems, but even I, could dispute a lot of them. But this, "Zaito" fund is hard to dispute. Turns out Zaito is a monster. Spending out of this fund is two-thirds of government spending that goes unreported in the main numbers. Funding comes from private individual Japanese citizens, public pension funds and investments in the state-owned Postal Savings System (must be like S.S. to the US). Well this monster fund has loans outstanding to the tune of $2.8 trillion! So if you add this debt, to what is officially reported ($4.5 trillion), then you have a whooping $7.3 trillion debt. But that's not all. The article claims more is buried in the numbers. So the real estimate for Japan's national debt is, $11 trillion or 250% of GDP! Ouch. The article also mentions something we discussed over in the semi-equip message board (don't post anything about Asia over there. They don't want to hear it). About how the Japanese may make the problem worse because of the recent restrictions lifted on financial markets. They are going to be free to invest their money in the US markets. If this should happen, it's not good for the Yen (It would weaken the already weak Yen). They couldn't raise interest rates (to strengthen Yen) because of the size of their debt. The government would go bankrupt if they did. Lot's of intricate problems. Then the article goes on to show how a large portion of their national debt is in big trouble. Basically the gist being that Japan is on the edge of a major, major problem and they have their hands tied trying to figure out what to do without going over the cliff. No wonder nobody is expecting any solutions to Japan's aliments in the near future. << Summary End. In my opinion, the most worrisome part is the Yen vs. US$ relationship. I doubt Japan is going to take a "tumble" off the cliff, but as the Yen gets weaker and weaker due to the above problems, then Japan buys less and less semi-equipment and wireless equipment, and networking equipment, etc. That's my biggest worry. I originally thought the article was going to be a bombshell story. But it did lack substance in a lot of areas. I believe even the US plays games with our S.S. fund, so the Japanese might fire that right back at Bill Clinton, if this subject is brought up. Nonetheless, even if it lacked substance in some areas, it was still pretty powerful in pointing out a LOT OF PROBLEMS. Not good for Japan, smaller Asian Tigers or ultimately, the US. MikeM(From Florida)