There’s something for everyone to await with trepidation or anticipation today.
The Bank of Japan will announce what, if any, new monetary stimulus to introduce. It might cut interest rates, which are already negative, or buy up bonds or other assets – even REITs and ETFs. They’ll be knocking at citizens’ doors and buying their TVs and cars next.
The idea is to stop the Yen from rising (though that would boost Japanese people’s purchasing power), to increase the inflation rate (which does the opposite) and to induce businesses to invest and citizens to spend, even though they have no need or desire to. Obviously, there is a rationale to avoiding deflation, but there is no logic to endlessly flogging a dead horse. (It does seem endless. How long ago was it that Japanese policymakers were toying with putting expiry dates on cash to force people to spend – 15, 20 years?)
Anyway – the big unknown is the implications of a weaker Yen/stronger US Dollar for China and the world. These range from potentially greater capital flight from the Mainland to a boost for Donald Trump, who is mightily vexed by China’s ‘currency manipulation’, news of which has only recently reached him.
The South China Morning Post has an op-ed article by Niall Ferguson, saying that life might not be so bad under President Trump after all, give or take various cataclysmic horrors too terrifying to mention. As you would expect of a revisionist historian specializing in restoring the British Empire’s coolness, Ferguson is a professional troll of self-righteous trendies (nice work if you can get it) and no doubt being provocative. But then there’s Hillary – and the unthinkable suddenly sounds less far-fetched. We can only hope those Japanese central bankers know what they’re doing.
We are also looking forward today to learning the fate of young Hong Kong radical student leaders Joshua Wong, Nathan Law and Alex Chow. As part of the government’s vendetta against Occupy/Umbrella movement participants, the three were prosecuted for unlawful assembly and incitement. A magistrate with (perhaps) a maternal soft spot for idealistic youths sentenced them to community service. The government is now appealing and demanding that the three be sent to prison with hard labour, bread-and-water, transportation for life. The verdict is due today.
The government’s unseemly pursuit of the trio arises of course from the Liaison Office-directed campaign against subversives, dissenters and localists – a campaign that backfired so wonderfully in the Legislative Council election a few weeks back. We now (or soon will) have a directly elected representative known as the Hon Nathan Law. (Talking recently to a member of Hong Kong’s establishment, I casually mentioned that I voted for Nathan. Blood drained from cheeks.) The Liaison Office has crawled off to lick its wounds for a while. If the court jails Joshua and Co, the government looks vindictive and alienates much of the public, even more, again. If the court rejects the appeal, the government ends up looking plain ridiculous.
Except, maybe, it will be too busy looking stupid for something else – this afternoon’s press conference on the Wang Chau land/Heung Yee Kuk/triads/collusion disaster. Chief Executive CY Leung looks icily self-possessed when executing Liaison Office orders to intimidate kids who have minds of their own; he comes across as a panicky loser when trying to shift blame for the Wang Chau mess onto the Financial Secretary.
Whatever happens with the Bank of Japan, the Joshua Wong appeal or the CY-John Tsang hands-in-cookie-jar, dog-ate-my-homework, buck-passing extravaganza, the world will be a different place by the end of the day.