Post-"Fiscal Cliff" US: Al Gore Wanted to Sell His Cable Network in December So As To Avoid New Tax Rate Come January 1

I thought Mr. Al Gore is one of those rich people and Hollywood celebrities begging the Obama Administration to tax them more. No?

New York Times reports that Mr. Gore and his associates were all very eager to conclude the deal of selling their cable network to Al Jazeera by the end of December 2012 so that they would avoid added tax that kicked in on January 1, 2013.

Well, they couldn't, as the agreement wasn't signed until January 2, 2013.

From New York Times (1/2/2013 part):

Al Jazeera Seeks a U.S. Voice Where Gore Failed

... Al Jazeera on Wednesday announced a deal to take over Current TV, the low-rated cable channel that was founded by Al Gore, a former vice president, and his business partners seven years ago. Al Jazeera plans to shut Current and start an English-language channel, which will be available in more than 40 million homes, with newscasts emanating from both New York and Doha, Qatar.

For Al Jazeera, which is financed by the government of Qatar, the acquisition is a coming of age moment. A decade ago, Al Jazeera’s flagship Arabic-language channel was reviled by American politicians for showing videotapes from Al Qaeda members and sympathizers. Now the news operation is buying an American channel, having convinced Mr. Gore and the other owners of Current that it has the journalistic muscle and the money to compete head-to-head with CNN and other news channels in the United States.

Al Jazeera did not disclose the purchase price, but people with direct knowledge of the deal pegged it at around $500 million, indicating a $100 million payout for Mr. Gore, who owned 20 percent of Current. Mr. Gore and his partners were eager to complete the deal by Dec. 31, lest it be subject to higher tax rates that took effect on Jan. 1, according to several people who insisted on anonymity because they were not authorized to speak publicly. But the deal was not signed until Wednesday.

A spokesman for Al Jazeera said that antitrust regulators had not expressed any objections to the deal.

(Full article at the link)

Antitrust regulators? Not a problem. They have just cleared Google with only a slap on the wrist, if any. As long as it involves supporters of the administration, all is good.

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Tokyo Metropolitan Government to IOC: "There is Zero Risk" in Holding 2020 Olympic in Tokyo

As the national government plans to force retailers to sell Fukushima produce, the Tokyo Metropolitan government's Tokyo 2020 Bid Committee declares to the International Olympic Committee (IOC) that "there is zero risk" in holding the 2020 Olympic in Tokyo.

No risk from an earthquake, no risk from a tsunami, no risk from a nuclear accident. Not a problem.

Kyodo News reports (1/4/2013):

五輪、地震や原発「ノーリスク」　招致委、ＩＯＣに強調

"No risk" from earthquake or nuclear plant accident, Tokyo Olympic Bid Committee emphasizes to IOC

２０２０年東京五輪招致委員会の水野正人専務理事は４日、国際オリンピック委員会（ＩＯＣ）に７日に提出する「立候補ファイル」では、大型地震による津波や原発問題への懸念を打ち消し、安全面について「ノーリスク」と記していることを明らかにした。

Masato Mizuno, Vice President of Tokyo 2020 Bid Committee disclosed on January 4 that the Committee has declared "No safety risk" from a large earthquake, tsunami, or nuclear problem in the "Candidature File" to be submitted to International Olympic Committee (IOC) on January 7.


　競技施設の耐震設計を紹介し、津波に対しては「東京湾の地図を示して水位が上がっても十分な防波堤がある」と説明しているという。

[The Candidature File] shows anti-seismic architecture of the Olympic venues; as to tsunami, the map of Tokyo Bay shows "there is sufficient breakwater even if the sea level rises", according to Mizuno.

　原発事故で放射線量が基準値を上回る地域があるとのＩＯＣの指摘には「東北でも低い数値で安定し、食品などは市場に出る前に厳重なチェックをしている」と盛り込んだ。

IOC has pointed out that there are areas whose radiation levels are higher than the standard because of the nuclear accident. The Candidature File counters this by saying "[The radiation levels] are low and stable even in Tohoku. A vigorous test is performed on food items before they are sold in the market."

Oh really.

The Candidature File will be delivered to IOC in Lausanne, Switzerland on January 7 by the captain of Japan's medal-winning women's soccer team.

The choices will be either Tokyo, Japan, or Madrid, Spain, or Istanbul, Turkey.

My bet is on Turkey, but with enough creative marketing (wink wink) on IOC members, IOC may want to help Japan eradicate baseless rumors.

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#Radioactive Japan under LDP: Law May Be Passed to Force Retailers to Carry Fukushima Produce

Speaking of population decrease, Japan has a ministerial post to deal with declining number of children in Japan. The new minister under the Abe pork-cutlet-curry administration is Ms. Masako Mori, who is also the minister in charge of consumer affairs.

In another WTF moment, Ms. Mori declares the new national government under LDP is considering passing the legislation to force retailers to sell Fukushima produce. It's not very clear from the article below by Fukushima Minpo whether this legislation is intended for retailers only in Fukushima, or any retailers anywhere. (The more I read it, it feels the legislation will be for the retailers everywhere in Japan, but not 100% sure.)

Fukushima Minpo also makes it obvious that Japan's Consumer Affairs Agency (whose head is the same Ms. Mori) is for helping producers, not consumers.

No wonder her party wants to ditch the Constitution, which guarantees freedom of commerce.

According to Japanese wiki, Ms. Mori was one of those "backbenchers" who heckled the DPJ politicians with vulgar words.

From Fukushima Minpo (1/3/2013):

県産品の販売促進へ法制化検討　森少子化相、扱い店舗優遇へ

Minister Mori says the government will consider legislation to promote produce and goods made in Fukushima, giving preferential treatment to retailers who sell Fukushima produce/goods.

森雅子少子化担当相（参院本県選挙区）は２日までに福島民報社の新春インタビューに答え、東京電力福島第一原発事故による風評被害を払拭（ふっしょく）するため、県産品の販売促進を目的とした法律の制定を検討する考えを示した。小売店に対し、安全が確認された農産物や工業品の販売を促す内容で、店頭に県産品を陳列した店舗の優遇などを想定している。森氏は平成２４年度補正予算で風評被害対策の関連費用を拡充させ、課題解決に向けた取り組みを加速させることも強調した。

Masako Mori, minister in charge of dealing with declining number of children (elected to the Upper House from District in Fukushima Prefecture), in a New Year interview with Fukushima Minpo, indicated that she is considering legislation to promote the sales of produce and goods made in Fukushima in order to eradicate baseless rumors resulting from the Fukushima I Nuclear Power Plant accident. The legislation will prompt retailers to sell agricultural produce and manufactured products that are confirmed to be safe. It will include preferential treatment of retailers who display Fukushima produce and goods in their storefronts. Ms. Mori also emphasized the government's commitment to expand the budget for countering the damages from baseless rumors in the fiscal 2012 supplementary budget and to accelerate the measures to resolve problems.

風評被害対策に当たる消費者庁も担当する森氏は「県産品を店頭に並べて、買いたい人が購入できる環境を整備しないと対策は前進しない」と述べ、小売店対策を本格化させる意向を示した。

Ms. Mori, also in charge of Consumer Affairs Agency which deals with countermeasures against baseless rumors, said, "Fukushima produce should be displayed in storefronts, and consumers who want to buy them should be able to buy them. Otherwise, the countermeasures [against baseless rumors] will not be effective", indicating she wants to work full-scale on the retailers.

風評被害に対する国の姿勢を明確に示すため、県産品の販売促進については法制化を目指す。今後、庁内や関係省庁と検討作業に入るとみられる。法案の概要については「本県を特区に指定し、国は小売店に対して、その地域の産品を扱うように命令したり、店頭で販売した店舗を優遇することができるようにする」と説明した。

[Mori said] the government will aim to pass the legislation to promote the sale of Fukushima produce and goods, in order to clearly show [to the public] how the national government stands on the issue of baseless rumor damages. It is considered that Mr. Mori's agency [Consumer Affairs Agency] and related agencies and ministries will decide on the details [of the legislation]. In summary, the legislation would "designate Fukushima Prefecture as the "special zone", and enable the national government to order retailers to sell locally-produced goods and to extend preferential treatment to retailers who sell such goods in the storefronts", Ms. Mori explained.

憲法で「営業の自由」が認められている小売店に対する命令に、どの程度強制力を持たせられるかが今後の焦点の一つになりそうだ。

The Constitution guarantees "freedom of commerce". It remains to be seen whether the legislation can legally force retailers.

森氏は平成２４年度補正予算で風評被害対策の関連費用拡充を求めることも明らかにした。啓発イベントを継続するとともに県産品への信頼を回復させるため生産者と消費者の対面販売などに力を入れる。消費地に向かう生産者の交通費負担など、きめ細かな支援策の必要性も認めた。

Ms. Mori also disclosed that she would ask for more money for countermeasures against baseless rumor damages in the fiscal 2012 [ending in March 2013] supplementary budget. Educational events would continue, and there would be more emphasis on face-to-face sales between producers and consumers to re-establish the trust in the Fukushima produce/goods. She said she recognized the need for carefully planned support for the producers, including the government paying for transportation costs for the producers to travel to consumption areas.

少子化・子育ての問題については、子どもの甲状腺検査の充実とスピードアップに向けて国が果たすべき役割を検証し早急に方策を練ることを約束した。

As to the problem of declining number of children and support for rearing children, she promised that she will examine what role the national government should play toward making the thyroid testing of children more meaningful and expediting the testing, and that the government would then work on a plan as soon as possible.

The last convoluted bit (which may make Sir Humphrey proud) means she won't do a thing either on the declining number of children or on the thyroid testing for children. This answer alone is enough to tell me she is a lawyer. (Sure enough, Japanese wiki says she was a classmate of Yukio "there is no immediate effect on health" Edano in Tohoku University Law School.)

About the possible unconstitutionality of Ms. Mori's legislation, Japanese Constitution Article 22 is generally interpreted to guarantee the freedom of commerce, as the freedom to choose occupation is meaningless unless the freedom of commerce is guaranteed:

Article 22. Every person shall have freedom to choose and change his residence and to choose his occupation to the extent that it does not interfere with the public welfare.
Freedom of all persons to move to a foreign country and to divest themselves of their nationality shall be inviolate.

I can perfectly see how Abe's LDP (which many say is not the LDP they've known) is going with this. They will limit the Article 22 by saying allowing this freedom of commerce interfere with the public welfare. See, how producers in Fukushima have suffered!

And the Abe government will strongly promote face-to-face sales by the Fukushima producers, knowing fully well that by nature most Japanese find it very hard to say no, face to face.

Where are Ishihara and Morita when we need them, to teach Japanese to say no? Well, Morita is long dead, and Ishiraha is playing politics with the boy-wonder. Neither of them would be likely to ever dream of saying no to their beloved government.

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(UPDATED) Bloomberg: Japan's Population Drops by Record 212,000 Last Year as Births Decrease

As far as I've seen, it was only last year that many in Japan finally realized that their country's population was declining at a irreversible rate, and finally became agitated or distressed about it.

Well. 23 years too late, I'd say. They could have done something before 1990, before the epic burst of the epic real estate bubble that had grown thanks to the 1985 Plaza accord of forced appreciation of Japanese yen and to a lesser degree Deutsche Mark to help the then-struggling US dollar (which had appreciated significantly in the first half of 1980s).

They would have had the money to spend to reverse the trend that had already been in place. It was back when the ex-Governor of Tokyo and the Sony's co-founder and chairman wrote a book "Japan That Can Say No". Instead of wasting breath on looking down on the US and the rest of the world and bragging about its own achievement, Japan could have taken a good look at itself and think about where it would want to go from there.

Well, after 23 years, taking a hard look at facts and thinking deep are still alien ideas for most Japanese.

From Bloomberg News (12/31/2012):

Japan’s Population Falls by Record in 2012 as Births Decrease

Japan’s population last year declined by 212,000, the biggest drop on record, according to an estimate by the nation’s health ministry.

That’s the largest reduction since the ministry started recording the data in 1947 and a sixth straight year of declines. The number of births fell by 18,000 to a record low of 1.03 million last year, the ministry said.

============================

(UPDATE 1/3/2013) A chart by the national government in fiscal 2010, by the very agency that Ms. Masako Mori is now in charge of. (See my next post about her and the policy of forcing retailers to carry Fukushima produce.)

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Peter Schiff: "Congress Sells America Down the River"

President Obama must be laughing all the way back to his Hawaiian vacation, as he vows more tax increase.

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UK Telegraph: Top Secret "Project Seal" - US and New Zealand Tested "Tsunami Bomb" During World War II

It was deemed "feasible", as it would inundate and destroy a small coastal city with 33-foot tidal wave.

How they could have lined up the explosives 5 miles off the coast (of Japan, presumably) would be a separate issue. But I have a feeling that Japanese would have preferred this "tsunami bomb" over two atomic bombs it got, 3 days apart in August 1945.

From UK's Telegraph (1/1/2013):

'Tsunami bomb' tested off New Zealand coast

The United States and New Zealand conducted secret tests of a "tsunami bomb" designed to destroy coastal cities by using underwater blasts to trigger massive tidal waves.

The tests were carried out in waters around New Caledonia and Auckland during the Second World War and showed that the weapon was feasible and a series of 10 large offshore blasts could potentially create a 33-foot tsunami capable of inundating a small city.

The top secret operation, code-named "Project Seal", tested the doomsday device as a possible rival to the nuclear bomb. About 3,700 bombs were exploded during the tests, first in New Caledonia and later at Whangaparaoa Peninsula, near Auckland.

The plans came to light during research by a New Zealand author and film-maker, Ray Waru, who examined military files buried in the national archives.

"Presumably if the atomic bomb had not worked as well as it did, we might have been tsunami-ing people," said Mr Waru.

"It was absolutely astonishing. First that anyone would come up with the idea of developing a weapon of mass destruction based on a tsunami ... and also that New Zealand seems to have successfully developed it to the degree that it might have worked." The project was launched in June 1944 after a US naval officer, E A Gibson, noticed that blasting operations to clear coral reefs around Pacific islands sometimes produced a large wave, raising the possibility of creating a "tsunami bomb".

Mr Waru said the initial testing was positive but the project was eventually shelved in early 1945, though New Zealand authorities continued to produce reports on the experiments into the 1950s. Experts concluded that single explosions were not powerful enough and a successful tsunami bomb would require about 2 million kilograms of explosive arrayed in a line about five miles from shore.

"If you put it in a James Bond movie it would be viewed as fantasy but it was a real thing," he said.

"I only came across it because they were still vetting the report, so there it was sitting on somebody's desk [in the archives]."

Forty years after the joint testing, New Zealand faced a dramatic breakdown in its security ties with the US after it banned the entry of nuclear-armed ships from entering its territory during the 1980s. The dispute led to the US downgrading its relationship with New Zealand from an "ally" to a "friend".

(Full article at the link)

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US "Fiscal Cliff" Averted at the Expense of Taxpayers, Hollywood and Rum Producers Rejoice

House Speaker John Boehner voted Yes;
House Majority Leader Eric Cantor voted No;
former VP-candidate Paul Ryan voted Yes.

Paul Ryan is surprising. So is Eric Cantor. (Good for Cantor.)

=====================

House Republicans fold. What's next for them to cave on? (Zero Hedge's Tyler says spending, and just about everything else. I agree.)

The so-called "deal" will mean 77% of the US households will see tax increase, while the tax breaks will go to all sorts of places from Hollywood to Virgin Islands, to NASCAR to algae growers.

CBO says the "deal" will add further $4 trillion to the debt over the next 10 years.

From ABC News (1/1/2012):

‘Fiscal Cliff’ Deal Also Doles Out Millions for Hollywood, Railroads, Rum Producers

The “fiscal cliff” compromise has been heralded as a saving grace for middle class taxpayers, their families and the unemployed.

But buried in the fine print of the 150-page deal are also some lesser-known New Year’s gifts to some of Washington’s favorite industries.

Under the plan, the federal government would eat nearly $100 billion in forgone tax revenue over the next two years by extending special tax credits for select businesses that had been set to expire.

While the provisions themselves are not new, and are often extended as part of major bills, their inclusion amidst a tumultuous year-end debate over deficits and debt  did raise a few eyebrows.

The nonpartisan Committee for a Responsible Federal Budget listed the so-called “tax extenders” as a “bad” part of the fiscal cliff deal because their cost is not offset, “setting a bad precedent for future extensions.”

The mix of tax perks covering the next year, but with budget implications for the next two years includes everything from incentives for employers to hire veterans to incentives for employers to invest in mine safety. But it also includes these:

• $430 million for Hollywood through “special expensing rules” to encourage TV and film production in the United States.  Producers can expense up to $15 million of costs for their projects.

• $331 million for railroads by allowing short-line and regional operators to claim a tax credit up to 50 percent of the cost to maintain tracks that they own or lease.

• $222 million for Puerto Rico and the Virgin Islands through returned excise taxes collected by the federal government on rum produced in the islands and imported to the mainland.

• $70 million for NASCAR by extending a “7-year cost recovery period for certain motorsports racing track facilities.”

• $59 million for algae growers through tax credits to encourage production of “cellulosic biofuel” at up to $1.01 per gallon.

• $4 million for electric motorcycle makers by expanding an existing green-energy tax credit for buyers of plug-in vehicles to include electric motorbikes.

*Note the price tags above reflect estimated forgone tax revenue if current credits – which have been due to expire – are extended for one year as included in the Senate bill, per Joint Committee on Taxation.

What about cuts? What cuts? Oh cuts, yes of course. Obama and the Congress will cut $15 billion in spending, against the tax increase of $620 billion. Tax and spending, unprecedented, first-in-the-history-of-the-republic-in-modern-times ratio of 41:1.

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Happy New Year 2013

Clean, crisp performance, fit for the first winter morning of the new year.

Brandenburgische Konzert No.3, G-Dur, Allegro, Johann Sebastian Bach.

Karl Richter, dirigent, mit Muenchner Bach Orchester

When I played this piece, I wondered how the middle development section would end and connect back to the theme in recapitulation. When that happened, it was by brute force, going from g-minor to the original G-Major without any preamble. The composer just did it, so to speak.

I remember chuckling, almost laughing, in admiration of the composer, as I was playing the particular passage. The conductor looked at me like I was crazy.

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(OT) For the Quiet End of Another Tumultuous Year

Herbert von Karajan, Dirigent
Berliner Philharmoniker

Ludvig van Beethoven
Symphony No.7 Allegretto

Thank you again for your support this year.

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(Now They Tell Us) US Nuclear Terrorism Specialists Were Sent to Japan Right After the Start of Fukushima Nuclear Accident to Measure Radiation

A short article by Kyodo News doesn't reveal much details, but it is clear, sort of, that the US was measuring radiation from the Fukushima I Nuclear Power Plant accident from very early on.

Kyodo News writes as if everybody knew there was a team of US experts measuring radiation around Fukushima I Nuke Plant right after the accident. (Did we?)

Kyodo News (12/31/2012):

米、原発事故に核特殊チーム派遣　初展開、菅政権把握せず

US sent a nuclear special team to Japan, first [overseas] deployment of the team; Kan administration did not know about the deployment

東電福島第１原発事故直後に、原発周辺の放射線量を測定するために米政府が日本に派遣したのは、核テロなどに備える特殊専門チームだったことが３１日、分かった。このチームが海外へ本格展開した初の事例だったが、当時の菅直人政権中枢は派遣の事実を当初把握していなかったことも判明。チームが実測したデータの公表が遅れ、住民の「無用な被ばくを招いた」（福島県浪江町議会の吉田数博議長）恐れがある。

It was revealed on December 31 that a team that the US government sent to Japan in order to measure radiation around Fukushima I Nuclear Power Plant right after the start of the nuclear accident was a special team to counter nuclear terrorism. It was the first overseas deployment for this team, but the core officials in the Kan administration weren't aware of the deployment at that time. The actual measurement [as opposed to simulations like SPEEDI] by the team was therefore delayed, and it may have caused "unnecessary radiation exposure" for the residents (Namie Town Assembly chairman).

チーム派遣決定に関わった複数の米政府関係者と、日本側当局者らが共同通信に明らかにした。

Multiple sources in the US government and the Japanese counterparts who were involved in the deployment disclosed the news to Kyodo Tsushin.

派遣されたのは、上空からガンマ線を実測し汚染状況を分析する「被害管理対応チーム」の３３人。

The team consisted of 33 people in "Damage Control and Response Team" [my translation, probably not the official name] in charge of measuring gamma radiation from the sky and analyzing the situation of contamination.

Could this team be from Nuclear Emergency Support Team? Kyodo article has a photograph provided by the US National Nuclear Security Administration, so it is likely it was this team.

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#Radioactive Japan: Former NRC Chairman Gregory Jaczko Visits Fukushima, Meets Evacuees

I haven't watched the entire program myself, but will do so tomorrow, before NHK finds the video and takes it down.

NHK BS-1 documentary "原発の“安全”を問い直す 米ＮＲＣ前委員長 福島への旅 (NRC former chairman's trip to Fukushima - to re-examine the safety of nuclear power plants)", first aired on December 22, 2012. The program is in Japanese, but you can hear Jaczko's comments in English, and you can catch the interpreter.

Jaczko visited Japan in August this year, soon after he resigned from the NRC.

原発の“安全”を問い直す ～米ＮＲＣ前委員長 福島... by tvpickup

While walking in Namie-machi with a former resident in Tyvek suits and mask, Jaczko says,

I see many different people with views about nuclear power. Some people try and say that really because no one was killed from radiation or appears to have received lethal doses of radiation that there's... such hype. But I think it is certainly very difficult to walk around here and see the livelihood that's just no longer there.

The town is frozen at March 11, 2011.

At the end of the program, Jaczko says,

"In the end, everyone has to keep in mind that the safety of the public is the number one responsibility, whether you are a power plant owner, whether you're a worker at the power plant, or a local or state or national government official, everyone has to recognize that safety of the people is the most important issue."

Well, it wasn't, in case of Japan. What came first and foremost was to tell people it was safe, and kept repeating it like a mantra.

Jaczko certainly does not come across as arrogant, bullying chairman that he was accused of being, by his colleagues.

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Guess Who Has Made Out Like a Bandit in Japanese Stock Market: Goldman Sachs

The company that never, ever loses any opportunity, being prepared for every contingency. (Well, almost.)

Even when the nuclear reactor buildings in Fukushima started blowing up, Goldman Sachs flew in at least four senior exectives from the US, who told its expats in Tokyo to stay put, or they would not have jobs at Goldman. Probably because there were great trades to make, probably on TEPCO (stock and bonds).

It looks Goldman Sachs started buying even before then-Prime Minister Noda said on November 14 that he would call an election, and ridden the Nikkei all the way, 20% up from the recent bottom.

Goldman Sachs Tokyo says they are bullish on Japan in 2013. (That is likely to mean they are ready to sell what they have to retail investors.)

From Bloomberg News (12/28/2012; emphasis is mine):

Goldman Sachs Buying Japan’s Exporters on Abe Policy Bets

Goldman Sachs Group Inc. (GS) is buying shares of Japanese exporters and banks as Prime Minister Shinzo Abe’s new government promises to do more to end deflation and weaken the yen.

The investment bank’s asset management unit in Japan is buying shares of the nation’s machinery and electronics exporters, financial firms and electricity producers, according to Hiroyuki Ito, Tokyo-based head of equity investment at Goldman Sachs Asset Management Co., which oversees about $716 billion globally. Goldman Sachs started increasing its holdings in October in anticipation that elections would be called, he said. The Liberal Democratic Party took power in a Dec. 16 poll.

...“Japan finally has a catalyst for the stock market to rise,” Ito said in a Dec. 26 interview. “The new government have an understanding of the impending danger and a sense of urgency about boosting the Japanese economy. We’re finally going to see an end to Japan’s deflation and a strong yen.”

Ito declined to discuss individual stocks.

The Goldman Sachs Japan Equity Fund Auto Reinvest Ushiwakamaru fund, managed by Ito and one of firm’s biggest Japan-based equity funds, has returned 11 percent in the past month, beating 86 percent of its peers, according to data compiled by Bloomberg. The fund’s biggest holdings are banks, carmakers, wholesalers and trading companies, the data show.

...“We’re bullish on Japanese stocks next year and the basis for that is the currency,” said Ito. “The yen’s strength has really hurt Japanese industry, but that trend has ended. The government has made its message very clear: they will be rigorous in boosting the economy.”

...Ito is also positive on Japan’s financial sector. Shares of banks and brokerages have surged in the past month on optimism reflation will boost the value of assets, increase loan demand and appetite for risk as people become more confident.

(Full article at the link)

Problem is that what Ito describes - BOJ reflates under Abe's command, assets value rises, people become more confident and want to take on more debt and more risk - hasn't happened in the US. 4 years after the financial collapse in 2008, people are still busy deleveraging, and banks are busy bidding up the stock market instead of making loans. Maybe Japan is unique and different, and may react to the money printing differently. (Never mind that it didn't react in the 1990s and most of the first decade of the 21st century.)

In contrast, Morgan Stanley Asia's chairman and chief economist Stephen Roach calls the so-called "Abenomics" delusional (emphasis is mine):

...Unfortunately, it appears that Japan has forgotten many of its own lessons – especially the BOJ’s disappointing experience with zero interest rates and QE in the early 2000’s. But it has also lost sight of the 1990’s – the first of its so-called lost decades – when the authorities did all they could to prolong the life of insolvent banks and many nonfinancial corporations. Zombie-like companies were kept on artificial life-support in the false hope that time alone would revive them. It was not until late in the decade, when the banking sector was reorganized and corporate restructuring was encouraged, that Japan made progress on the long, arduous road of balance-sheet repair and structural transformation.

US authorities have succumbed to the same Japanese-like temptations. From quantitative easing to record-high federal budget deficits to unprecedented bailouts, they have done everything in their power to mask the pain of balance-sheet repair and structural adjustment. As a result, America has created its own generation of zombies – in this case, zombie consumers.

Like Japan, America’s post-bubble healing has been limited – even in the face of the Fed’s outsize liquidity injections. Household debt stood at 112% of income in the third quarter of 2012 – down from record highs in 2006, but still nearly 40 percentage points above the 75% norm of the last three decades of the twentieth century. Similarly, the personal-saving rate, at just 3.5% in the four months ending in November 2012, was less than half the 7.9% average of 1970-99.

The same is true of Europe. The ECB’s über-aggressive actions have achieved little in the way of bringing about long-awaited structural transformation in the region. Crisis-torn peripheral European economies still suffer from unsustainable debt loads and serious productivity and competitiveness problems. And a fragmented European banking system remains one of the weakest links in the regional daisy chain.

Is this the “cure” that Abe really wants for Japan? The last thing that the Japanese economy needs at this point is backsliding on structural reforms. Yet, by forcing the BOJ to follow in the misdirected footsteps of the Fed and the ECB, that is precisely the risk that Abe and Japan are facing.

Massive liquidity injections carried out by the world’s major central banks – the Fed, the ECB, and the BOJ – are neither achieving traction in their respective real economies, nor facilitating balance-sheet repair and structural change. That leaves a huge sum of excess liquidity sloshing around in global asset markets. Where it goes, the next crisis is inevitably doomed to follow.

Let's see, strictly on past performance, I would bet with Goldman Sachs over Morgan Stanley, even though I agree with Mr. Roach.

My guess is that most Japanese would understand Goldman Sachs' view (or want to understand), and would not have a clue what Morgan Stanley's Roach is talking about (or do not want to know).

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OT: Lights Out for Paris, France

If you venture out in Paris between 1AM and 7AM, bring your torch (flashlight), says UK's Daily Mail.

As France's top court rules his 75% tax rate for the "rich" is unconstitutional, President Hollande goes on, trying to instill "sobriety" in the French by turning off lights in Paris and other cities, towns and villages all over the country.

And save money.

How about saving money by cutting your bureaucracy, Mr. President?

Instead, he will punish people - tradesmen, tourists, locals.

At least in France, rich people are defined as "having 1 million euro income or more", not like the US's 250,000 dollars or worse, Greece's 45,000 euro.

From Mail Online (12/29/2012; emphasis is mine):

Lights to be turned off in France to save money and show 'sobriety'

Paris may lose its trademark glow next year after plans emerged to extinguish its street lighting at night to save money.

French President Francois Hollande and his energy minister Delphine Batho are considering turning out the lights in and outside public buildings, offices and shops in the early hours of the morning.

If the scheme goes ahead, late-night revellers in the city would be advised to carry torches if they venture out between the hours of 1 and 7am.


The rules will also apply to other French cities, villages, and towns.

Batho said the measure would save energy and money, and show 'sobriety', although the plan has proved unpopular with traders.

It follows on from a new rule last July which states businesses must turn off neon lights between 1 and 6am. The measure was introduced as part of the French government's bid to improve its energy efficiency by 20 percent by 2020.

But the proposal was not popular with businesses, who believe that it could kill trade and discourage tourists.

'Visitors and locals follow the light, from one spot to another, all night long,' French chef and culinary consultant Didier Quemener told Quartz.

'My clients don’t want to be in the dark in the City of Light.'

France was visited by more than 81 million tourists in 2011 and the tourism industry employs some 900,000 people, according to government figures cited by Bloomberg.com.

Fearing for the impact on the economy, vice-president of France’s Commerce Council, Sofy Mulle, told Bloomberg there must be a better way.

She said: 'Surely we can work out environmentally friendly solutions that have less impact on our society and economy.'

The plan is already in place at the city’s more than 300 churches, bridges, and monuments, including the Eiffel Tower.

'One of our main objectives is to change the culture,' energy minister Batho told a French TV station.

'We need to end the cycle of producing more because we are consuming more. There should be sobriety in energy use.'

The energy minister Delphine Batho's word sounds ominous to me. To change the culture, to what she and her boss think should be. There should be sobriety, forced by them.

Well, they won the election, so they must be thinking, like the US president and the Japanese prime minister, that they have the mandate.

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Lawsuit by US Sailors Against TEPCO: "Goshi Hosono,You Lied!"

It's very interesting to see the reaction of the Japanese people on Twitter. I'd say the overwhelming majority is highly approving of the US sailors (they were not the helicopter pilots who were actually contaminated with radiation), buying all their arguments and sympathizing with them, particularly with the female sailor who was pregnant at that time.

(What was she doing on a nuclear aircraft carrier, pregnant?)

Anyway, the court paper filed on December 21, 2012 is here, for those who are interested. I'm skimming through it right now. So far, very flimsy.

One of their basis that the TEPCO/Japanese government (they use them interchangeably) lied to them was no other than Goshi Hosono, then a personal advisor to Prime Minister Naoto Kan.

Page 21 of the court document says (emphasis is mine):

94. Upon information and belief, as a further direct and proximate result of Defendant's negligence, Plaintiffs have been and will be required to undergo further medical testing, evaluation and medical procedures, including but not limiting to chelation therapy and bone marrow transplants in an effort to seek cure, and will be required to employ extraordinary means to achieve cure.

95. As a further direct and proximate result of Defendant's negligence, the Plantiffs incurred losses and damages for personal injury and property damage, loss of use and enjoyment of life and their property, the need for periodic medical examination and treatment, and economic losses, including wage loss, and the expenditure of time and money, and will continue to incur losses and damages in the future.

96. Plaintiffs also face additional and irreparable harm to their life expectancy, which has been shortened and cannot be restored to its prior condition.

97. Solely as the result of the defendant's negligence, carelessness and recklessness, the Plaintiffs, were caused to suffer severe and serious personal injuries to mind and body, and further, that the Plaintiffs were subjected to great physical pain and mental anguish.

Mr. Paul C Garner, who represents the Plaintiffs, seems to be an attorney from New York, specializing in "General Litigation; Corporate Law; Negligence Law; Medical Malpractice; Wills, Estates and Trusts; International Corporate; Entertainment Law; Business Law; Civil Practice; Environmental Law; Asbestos Litigation; Real Estate" (from Martindale.com)

USS Ronald Reagan's Facebook post on that day (Sunday, March 13, 2011 at 11:52pm, probably the US time) by Commanding Officer Captain Thom Burke says (emphasis is mine):

Friends and Family of USS Ronald Reagan:

I want to take this opportunity to personally assure you that first and foremost all personnel aboard the USS Ronald Reagan are safe and healthy.

During our mission to assist our close allies of Japan, we were operating near the radioactive plume from Fukushima Dai-Ichi Nuclear Power Plant. As you may have already heard, radioactivity was detected on 17 personnel from our ship, however, we promptly took the proper precautions and the radioactivity was easily removed by using soap and water. The levels that were detected were very low levels. To put this into perspective, the maximum radiation dose received was equalt to the amount of natural background radiation one would receive in one month from sources such as rocks, soil and the sun.

Ronald Reagan has since repositioned away from the Fukushima Dai-Ichi Nuclear Power Plant.

As a nuclear-powered aircraft carrrier, we have extensive technical expertise onboard to properly monitor such types of risks, and if necessary, rapidly resolve the situation.

We have taken all the necessary precautions to ensure that everyone is safe. We have closely monitored spaces, evaluated everyone who has flown or worked on the flight deck and cleaned the aircraft.

I have not seen any levels of radiation or contamination that would cause me to have any significant concerns at all.

As we continue to assist Japan in this terrible catastrophe, our Sailor's--and your loves ones'-- safety will remain at the top of my priority list.

Capt. Thom Burke

The Japanese would take this as confirmation to their belief that all officials "lie".

All I can think of is how many bento would this money could buy for Futaba-machi evacuees in that abandoned high school building in Saitama. They could build a mansion for each and every one of them. Many of them, just like Mayor Idogawa, were there in Futaba-machi when Reactor 1 blew up and shiny, white particles were falling on them from the sky.

(H/T anon reader for USS Ronald Reagan's Facebook post)

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Japan's Nuclear Regulatory Authority Experts Conducting 2nd Field Survey at Ooi Nuke Plant

The geologists headed by Dr. Kunihiko Shimazaki of the Nuclear Regulatory Authority are doing the second field survey in the only operating nuclear power plant in Japan, Ooi Nuclear Power Plant in Fukui Prefecture. They did the first survey last month, but there was an opinion expressed by one of the geologists that the fault may have been caused by a slide, and not an active fault. So they are conducting the second, expanded survey. The size of the trench is 80 meters long, double that of the first survey. (Information from ANN News)

Video from ANN News (12/27/2012):

The NRA has so far declared the faults in Tsuruga Nuke Plant and Higashidori Nuke Plant as "active". Geologists and NRA are almost laughing at Tohoku Electric's claim that what Higashidori Nuke Plant has is not an "active fault" but simply a swelling. They said if Tohoku Electric were correct, there would be an upheaval all around the world, because it would be news to all geologists.

If I remember right, the majority of the experts had declared the fault in Ooi Nuke Plant as "active" after the first survey. Dr. Shimazaki, deputy chairman of the Nuclear Regulatory Authority has said they will need to look at the geological structure under the reactor buildings at Kashiwazaki-Kariwa Nuclear Power Plant. Dr. Shunichi Tanaka, chairman of NRA, is quite nonplussed about criticisms from the industry, saying he is simply evaluating, based on science, and giving full freedom to the experts to express their candid assessment.

Who could have known that this organization would be actually doing its work.

The experts are about to start a press conference on site.

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BBC: TEPCO Sued by Eight US Soldiers Over Radiation Disclosure

The soldiers were part of the Operation Tomodachi, which was such a tremendous help to the people in the disaster-affected areas in Tohoku in the early days of the earthquake/tsunami disaster in March last year. Unfortunately, the disaster also involved the nuclear accident, but at that time hardly anything about radiation exposure for the US soldiers, or SDF soldiers, or Japanese and international volunteers, were even mentioned in the news.

Asahi Shinbun reports that these soldiers were on board USS Ronald Reagan.

See, people in Japan, this is how much you should also sue TEPCO for - demanding US$10 million each (860 million yen), plus punitive damage of US$30 million. Add one or two zeros on your claim form.

The problem of course is that that money, or any money being demanded out of TEPCO, will eventually come from Japanese taxpayers' pockets, now and in the future. TEPCO is owned by the national government.

USS Ronald Reagan was in the Korean Peninsula region when the March 11, 2011 disaster struck. The carrier was diverted to Japan, and was used as a floating base off the coast of Sendai, Miyagi. From Wiki entry:

The ship departed for an Asian deployment on 2 February 2011. On 11 March 2011, Reagan was in the Korean peninsula region for a long-planned exercise off Korea, but was redirected towards Japan to provide support after the massive 2011 Tōhoku earthquake and tsunami. The ship, stationed off Sendai, was used as a floating refueling station for Japanese military and coast guard helicopters flying relief missions in the area.[28] US Navy helicopters also flew relief missions from the carrier. On 14 March 2011, the ship was forced to relocate to avoid a radioactive plume from the Fukushima I nuclear accidents which had contaminated 17 crewmembers of three helicopter crews.[29][dead link] On 23 March, the Reagan's crew conducted a radiation decontamination operation to remove any further radiation hazards from the ship, which included scrubbing down any surface that could have been contaminated, including the flight deck and aircraft.[30]

The report on March 14, 2011 about the ship relocating is here. It says the 17 helicopter crews were exposed to one month worth of background radiation, and they were on a relief mission to Sendai, Miyagi.

From BBC (12/27/2012; emphasis is mine):

Japan's Tepco sued by US sailors over radiation

Tokyo Electric Power Company (Tepco), owner of the crippled Fukushima Daiichi nuclear plant, has been sued by eight US sailors over radiation exposure.

They claim that Tepco lied about the threat posed by the leaks after the March 2011 earthquake and tsunami damaged the plant.

The soldiers were involved in relief operations after the natural disasters.

They have each sought $10m (£6m) in compensatory damages and $30m in punitive damages from Tepco.

The soldiers, who have filed the case in a US Federal Court in San Diego, also want Tepco to set up a $100m fund to pay for their medical expenses.

They have claimed that the utility provider created an impression that the level of radiation leaks from the nuclear plant did not pose any threat.

As a result, the sailors say they went to areas that were unsafe and were exposed to radiation.

When contacted by the BBC, Tepco acknowledged that it has been sued, but said that it had not received the actual complaint and so was not in a position to comment.

The lawsuit is the latest setback for Tepco which is already facing billions of dollars in compensation claims.

The radiation leaks resulted in thousands of people and businesses being evacuated from the areas surrounding the plant.

On Thursday, the firm said that it now expects the compensation costs to total at 3.24 trillion yen ($38bn; £23bn), up 697 billion yen from its earlier projection.

The firm has already received nearly 1tn yen in government aid.

The utility was, in effect, nationalised after the government took a 50.11% stake in the group in exchange for the capital injection.

In September this year, the US Department of Defense set up a special registry for the participants of the Operation Tomodachi.

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Bloomberg News: Toshiba in Talks to Sell as Much as 16% of Westinghouse

From Bloomberg News (12/26/2012; emphasis is mine):

Toshiba Corp. is in talks to sell a stake of as much as 16 percent in its Westinghouse Electric Co. nuclear-power unit, the Japanese company said.

The company is in talks with three parties over the possible sale, Toru Ohara, a spokesman for Tokyo-based Toshiba, said by phone today, confirming comments by President Norio Sasaki, reported earlier by MarketWatch.

The Japanese company said in October it had “received interest” from potential partners about acquiring a stake and was open to talks on the condition that Toshiba retains majority control. Toshiba is set to acquire 20 percent of Westinghouse from Baton Rouge, Louisiana-based Shaw Group Inc. (SHAW) next month for 125 billion yen ($1.5 billion), bringing its total stake to 87 percent.

Toshiba paid $4.16 billion for 77 percent of Westinghouse in 2006. It nows owns 67 percent after Kazatomprom, Kazakhstan’s state nuclear company, purchased 10 percent in 2007.

Toshiba rose 3.2 percent to 321 yen at the close of trading in Tokyo, while Japan’s benchmark Nikkei 225 Stock Average gained 0.9 percent. The stock has advanced 1.9 percent this year.

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Japan Future Party Leader Kada Says She Will Split the Party by Year's End

(UPDATE) Jiji Tsushin reports (12/27/2012) that it's been decided by the deputy leader of the party Tetsunari Iida and Mr. Ichiro Ozawa that Mr. Ozawa's followers in the party, 15 of them including the Upper House councilors, will leave the party. Ms. Kada will have one Upper House councilor (she left Social Democratic Party to join Ms. Kada's party), but according to Jiji, Ms. Kada says her group will retain the name of the party and the party logo. Which means her party with only one elected official will receive all the government subsidy money for political parties, and Mr. Ozawa's new party, when he or his followers formally announces the formation, will have none. Good deal for Ms. Kada. What a joke.

====================================

So much for her pre-election talk of her being capable of "taming and controlling Mr. Ichiro Ozawa".

Faced with the opposition to her dictatorial ways of running the party ("No dissent allowed", said Ms. Kada), the leader of the "graduating from nuclear" party now says she will split the party by the year end, so that she and her small and mostly unelected party leaders will have their own way (while probably keeping the political party subsidy from the national government - taxpayers' money), and Mr. Ozawa's followers their own way by forming a new party (thus losing the subsidy even though they are the vast majority in the party).

After having no action, no comment from her after the disastrous election on December 16 when only 9 candidates managed to hold their seats while all of her own candidates lost, the first official political act by Ms. Yukiko Kada, the leader of the party that anti-nuclear Japanese citizens had pegged so much hope on, is to split the party.

Again, as with many instances since the election, she spoke to the press, without bothering to speak first to her party members, whom she apparently considered to be plotting a coup d'etat against her for daring to oppose her unilateral decision on party appointments.

The run-up to the meeting, and what transpired after the meeting, suggest that seasoned politicians with influence like Mr. Shizuka Kamei and Mr. Ichiro Ozawa made a grievous mistake joining her. So much so that Mr. Kamei has already decided to leave the party.

By the way, on December 26, the Shiga prefectural assembly passed the non-binding resolution demanding her to choose between the governorship and the party leadership. Ms. Kada's answer is that she will continue to hold both positions, as the resolution is non-binding. There was a talk of a binding resolution (no confidence), but the parties in the assembly decided to tone it down for some reason.

There are some who say Mr. Ozawa has lost his touch for having chosen her. I have been wondering why he, and for that matter Ms. Kada, decided to form a political party whose only distinct platform is "graduating from nuclear". (The rest of their so-called policies look no different from those of DPJ or LDP.) My feeling is that they were blinded by the supposedly overwhelming support for their position on the Internet. They themselves don't look to be particularly Internet-savvy but their lieutenants most likely are.

As usual (since March 11, 2011), there are die-hard online fans of the party, accusing anyone who dare criticize their dear leader (in this case Ms. Kada) who has promised she will take them to the post-nuclear Japan in 10 years.

"Fool me n-th time, shame on you", they would say to infinity.

(Links are in Japanese.)

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#Radioactive Japan: Futaba-machi Mayor Idogawa Fights No Confidence Vote, Dissolves Town Assembly and Calls for an Election

I reported about the mayor and his town assemblymen who unanimously passed the no-confidence resolution against Mayor Idogawa on December 20.

Mayor Idogawa has decided to fight for his townfolks, some of whom are still living in an abandoned high school building in Saitama Prefecture, 21 months after the start of the accident. They have to pay for their own boxed meals, and over the New Year's holidays the bento vendor will be closed for business.

From Nippon Television News (12/26/2012):

福島第一原発事故を受けて役場の機能を埼玉・加須市に移している福島・双葉町は２６日、井戸川克隆町長が議会を解散した。

Futaba-machi, whose municipal government has been temporarily moved to Kazo City, Saitama Prefecture following the Fukushima I Nuclear Power Plant accident, has dissolved the town assembly at the order of Mayor Katsutaka Idogawa.

　原発事故を受けて役場機能を加須市に移している双葉町は、２０日の定例議会で、井戸川町長への不信任案が提出され、全会一致で可決された。可決から１０日以内に議会を解散しないと自動的に失職することになるが、２６日、井戸川町長は会見を開き、議会を解散したことを明らかにした。

The no-confidence resolution against Mayor idogawa was submitted during the regular assembly meeting on December 20. The resolution was unanimously passed. The mayor will lose his position in 10 days after the vote, unless he dissolves the assembly. On December 26, Mayor Idogawa held a press conference, and announced that he has dissolved the assemly.

　井戸川町長「議会を解散いたしました。私なりに考えを巡らしてまいりました。このような決断に至り、断腸の思いです。原発事故さえなければ平和な町であったのに、非常に残念」

Mayor Idogawa said, "I have dissolved the assembly. I have been weighing things as best I can, and this is a gut-wrenching decision. It would have been a peaceful town if it hadn't been the nuclear accident. I am very disappointed."

　解散から４０日以内に、町議選が行われることになる。

The town election is to be held within 40 days.

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#Radioactive Japan Under LDP: Shintaro Ishihara's Son to Become Minister of the Environment and Minister for Nuclear Plants

What an in-your-face insult to citizens of Japan, particularly for people in Kanto and Tohoku contaminated by radioactive materials from the nuclear accident, and even more so for the workers at Fukushima I Nuclear Power Plant.

Nobuteru Ishihara is the eldest son of the irascible ex-Governor of Tokyo Shintaro Ishihara, for now teaming up with the boy-wonder of Osaka City.　(He didn't inherit his uncle (Yujiro Ishihara)'s good looks or charisma, unfortunately.)

In the early days of the nuclear crisis last year, Mr. Nobuteru Ishihara was the one who said that citizens should be banned from measuring radioactivity using their personal survey meter. His ostensible reason was that the survey meters may not be "accurate". It turned out the government's monitoring stations have been inaccurate.

In June last year, he was the one who called the anti-nuclear movement as "mass hysteria".

He was also the one who compared Fukushima I Nuclear Power Plant to Aum Shinrikyo, a cult that was responsible for the sarin gas attack on the subway in 1995. Ishihara referred to Fukushima I Nuclear Power Plant as "Fukushima I Satyam". "Satyam" is the word that Aum Shinrikyo followers used to designate their facilities.

(Aum Shinrikyo is alive and well, by the way. The name has been changed, and they are increasing followers in Japan.)

Under the prime minister whose proof of being fit to govern was to gobble up the curry rice with pork cutlet on top, Ishihara will be in charge of decontamination (or lack thereof) and ending the nuclear accident (probably by ignoring it). Needless to say, he is all for restarting nuclear power plants.

It won't be long that people start thinking fondly about Goshi Hosono and his disaster debris craft dolls. (At least Hosono is better-looking.)

I wonder if Ishihara is going to receive double salaries for the double positions. A minister in a Japanese cabinet makes about 37 million yen (about US$434,000) a year. For many workers in Japan, that would be 10 years worth of salaries.

Even Goshi Hosono declined to receive two salaries for his double duty as Minister of the Environment and the Minister in charge of nuclear plants/Fukushima accident.

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