Decentralization?

The yen has gained against the Dollar by 24%, seen as a likely disaster for Japanese trade products, and virtually eliminating the yen carry trade. Recognize that We are talking about the second largest economy in the World behind the U.S. alone, and this not only ended yen provision of cheap financing to emerging markets, but virtually all Japanese products face impossibly effective competition from cheaper alternate sources. The Population density of the Islands nation insist that they must hold their Export volume to fund necessary Imports. The economic resource pressures driving the pre-WWII Japanese economy are again coming to the fore, with Japan possessing limited options. Japanese militarism has been seemingly dead since the crushing defeat in the mentioned Conflict; yet, Japan has an immense Population combined with a great Ship-Building capacity. What happens if the Japanese economy falls into 5th or 6th place among World economies; a level easily envisioned under the new economic pressures of Crisis?

Japan is not alone in the economic Crisis, as this article will express. Iceland raised its Interest rate to 18% to get emergency aid from the IMF, after the Iceland crown stopped trading on October 22nd. Several nations are looking for outside assistance in the financial crisis, the article naming the Ukraine, Hungary, Pakistan, S. Korea, and Brazil. Russia is borrowing from China, an unheard of element, considering the traditional cultural competitiveness of the two nations. Most of the World is looking for finance from the rest of the World, and will not likely find it in the volume necessary to avoid major economic distress.

The essential Questions becomes what comes next? Economic incentives are not such that We can expect a quick return to the optimism We felt less than a year ago. Is it even time for a comprehensive economic policy? Can a correct Monetary policy affect the real economic factors which exist? The Private Sector has apparently assumed that a reorganization through mergers is the Solution to current economic problems; seemingly good, except this Crisis assures that Private Sector entities can grow so large as to be immune to the forces of the Market. There is even some suspicion on my part that small, easily replaceable component part businesses are the Solution; the unenviable Result of management complexity destroying Survival capability. An Example would be to have 30 Car companies, instead of 3 or less. Thirty car companies would leave 5 still Profitable because their Car models of Consumer taste determined the Profitability of the company. The management decentralization works across the entire economic spectrum, and rewards Profits in their proper proportion (the system of quick Bankruptcies, quick Sell-off of industrial assets, and more of an Investment gamble). lgl