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

To: Zeev Hed who wrote (3821)	5/24/1998 5:54:00 AM
From: Moominoid	Read Replies (1) \| Respond to of 9980

David, it took Mexico about a year to recover from their tail spin. Mexico is discussed as a counter-case. They got tremendous and fast aid from the US. Which hasn't been the case in my other examples to varing degrees. Also Mexico is straight over the border from the World's fastest growing economy in absolute dollars (not rates of growth). I think each country will have different rates of recovery. Korea will probably be back in a growth mode after 12 to 18 months of negative growth in GNP, this because the Chaebols are consolidating, selling assets to foreigners, bringing in foreign partners and behaving quite pragmatically. Korea will do best I think. Malaysia is trying not to adjust. Thailand is somewhere in between. Indonesia is calamitous. The main problem is Japan and as is being increasingly discussed here Hong Kong / China. David

To: Zeev Hed who wrote (3821)	5/24/1998 8:31:00 AM
From: MikeM54321	Read Replies (1) \| Respond to of 9980

Speaking of Japan, rarely do you find anything defending their economic policies. So I thought this article was of special interest. It was very long so it's heavily edited to save space. It's written from the viewpoint of people who live there. It helps explain why Japan is so slow to change. It's from the NY Times. MikeM(From Florida) >>Shops Closing, Japan Still Asks 'What Crisis?' By NICHOLAS D. KRISTOF MIYA, Japan -- Aside from the fact that his beloved little business is collapsing after a lifetime of effort, Mitsuo Okura is rather pleased with life..He smiles amiably as he mocks his own foolishness for expanding his factory eightfold during Japan's "bubble economy" of the late 1980s.."People complain about the bad economy," Okura mused here in Omiya, a little town nearly 200 miles southwest of Tokyo. "But when I look around the house, I've got everything I want. I've got three cars, and most families around here have two or three as well. I've got a couple of televisions, and so do most people. I've got a washing machine, a refrigerator, and so do all my neighbors. Even if no one sees a bright future," he added, "there's no feeling of crisis." And that may be Japan's problem: life is too comfortable. Indeed, the Clinton administration sometimes suggests that Japan is on the verge of economic collapse, and it portrays Japan as a threat to the entire global economy. But sit on the tatami mat floor in a Japanese home like Masamisu Nishi's here in Omiya, and life still seems so secure that people feel little urgency about change. Mr. Nishi, a former Honda worker who now runs a construction company with 40 employees, says business is terrible, but he adds that his family and neighbors have been scarcely affected by the downturn. Indeed, most people here say they do not know anyone who has ever been laid off. Unemployment in Japan is at a record high, but that is still just 3.6 percent - more than a percentage point below the rate in the United States. Inflation is zero. Interest rates are negligible, and business bankruptcies per capita are still one-third lower in slumping Japan than in booming America. "There isn't much feeling of a downturn among ordinary people," Nishi said, despite Japan's slightly negative growth for the last year. As he relaxed on a cushion on the floor, nursing a coffee in the tranquil night air, he added: "Even with my family, business isn't good, but we haven't cut back on our living standard." ..."As for me," Mrs. Nishi said, "I just don't see any signs of a crisis." The Trap: A Nice Warm Bath Is Hard to Leave There is an expression in Japanese, "nurumayu," that describes the coziness of a lukewarm bath even when someone knows that it is time to step naked out of the tub and face the chill. Many Japanese say that their nation's economy is "nurumayu," and they realize that it is time to get out -- but that the bath is so lulling that they cannot summon the energy to do so just yet. "Frankly, I'd just as soon stay in the bath," mused Hironori Takayama, a young banker in a town near Omiya. "But these days, even if you try to stay in the bath, the tub will crack and the water will leak out. So if you stay in you risk getting chilly and catching cold. It's not much of a choice." "After the Soviet Union collapsed, I thought that socialism had failed and that capitalism was better," said Takayama, expressing an epiphany that seemed odd coming from a banker in a dark suit in what is usually thought of as the biggest capitalist economy outside of America. "But when I visited Singapore one time, I saw skyscrapers and then what looked like a slum next to them. I was surprised, and maybe that's because Japan is the only place where that kind of thing doesn't happen, the only place where everybody thinks of themselves as middle class." Takayama brooded for a few minutes. Then he added: "I don't want to get out of this bath."<<