The economic impact of the tsunami is hardly the most important thing. But this being the day when I normally blog / link economic news, I figured it would be worth checking in on what is going on there in this context.
The least surprising news is that the Nikkei, Japan’s stock market, took a huge hit as a result of the chaos. That index is down 6.2% this morning. They’ve been suffering from the same cash flow problem that the United States has been for the last few years – it is primarily the lack of cash and readily-available credit in the marketplace that’s been shutting down business as usual here and abroad. And just like the United States, Japan has been venturing into the world of Quantitative Easing. Now with the disaster, they’ve opened up the QE floodgates in the hopes of injecting more than 10 billion yen into the market.
Interestingly, this has to be the first international crisis in the past twenty years that caused the price per barrel of oil to decrease, on concerns about Japanese consumption drops. At least as interestingly, Business Insider is speculating that it may also have to do with Saudi troops moving into Bahrain. Not sure I understand that at all.
And here’s something I understand even less, but love more: Japanese officials are urging their residents to – wait for it – *not* go to work today. Apparently, this kind of thing presents a problem in Japan, whereas in this country when times of crisis hit us, we’re urged to shop.