Global Economy: Between A Rock And A Hard Place

07/07/201843 Comments

Well, it’s official: “Japan Inc.” is now “Bank of Japan Inc.”

Oh, OK, not officially official, but just about. As the Nikkei Asian Review reports, the Bank of Japan (BOJ) is now a top-10 shareholder in a whopping 40% of the listed companies in the country. That’s right, having purchased 25 trillion yen ($227 billion) worth of exchange-traded funds in the past eight years, Japan’s central bank is now one of the top 10 shareholders in 1,446 out of 3,735 companies listed on the Tokyo Stock Exchange.

So what does this all mean?

Well, if you’re Japanese it means your central bank is creating (as one Japan-based asset manager puts it) “a new form of financial socialism” from which “[n]obody can see a smooth exit strategy.”

But more broadly, the economic pickle that Japan finds itself in right now is merely a small-scale example of the dilemma that the global economy is facing. Caught between the low-interest global liquidity trap and the high-interest global debt trap. Caught between the globalist “free trade” nightmare and the emerging trade war/hot war nightmare. Caught between the expansion of a predatory system that is designed to drain the wealth of the average worker and the collapse of that system, which will assuredly drain the wealth of the average worker.

The straits between these economic rocks and hard places couldn’t be any narrower. It’s enough to make Scylla and Charybdis look like a cakewalk.

Economics is never just economics. Learn more about the world-historical paradigm shift we are living through right now and how it is reflected in these economic stories in this week’s edition of The Corbett Report Subscriber.

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