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abenomics doesn't work well, maybe that's why he chiong the shrine visiting, incur china's wrath, something to do before he depart. 
http://online.wsj.com/news/articles/SB10001424052702303942404579360091631473678
Monday's slide in Tokyo stocks, which saw the Nikkei index fall another 2% to land 10% below its high little more than a month ago, can be explained different ways. Some blame the weak example offered by U.S. traders on Friday, a slowdown in Asian trading activity amid the lunar new year holiday, exchange-rate gyrations or merely ill-defined global skittishness. But there's no way around the pressure this development, on top of many others, puts on Prime Minister Shinzo Abe.
The stock market has offered arguably the most enthusiastic endorsement to date of Mr. Abe's eponymous economic revival program. In the six months after his election in December 2012, the Nikkei index rose nearly 60%. After a correction last May, it continued to climb.
This was taken, correctly, as a sign that foreign investors in particular were impressed by the rising corporate earnings Japan Inc. seemed to be generating under Mr. Abe. An asset-price surge became part of the Abenomics strategy, on the theory that rising stocks would fuel the positive sentiment Mr. Abe and his advisers believe is so important to reviving the real economy.
But investors are starting to take a more critical look at Mr. Abe's program. Coming weeks will tell whether the market is in a correction akin to the one it experienced last May or whether the balloon is deflating for good. But there's good reason to worry about the latter.
Take those high corporate earnings, which were mainly a result of Mr. Abe's weaker yen policy allowing companies to book higher yen-denominated profits on overseas sales—sales that are declining when measured by units shipped. This has yet to stimulate domestic wage growth, and may not do so.
Meanwhile the recent strengthening of the yen against the dollar raises questions about exactly how much longer this profit boost will last. Investors also worry about how corporate earnings will fare when Mr. Abe's consumption-tax hike takes effect in April.
Against these concerns, Mr. Abe's reform program remains unsatisfying. His so-called third arrow of domestic reform hasn't inspired enthusiasm because it omits key issues such as labor-market liberalization. His push to open the sheltered economy to imported goods and services as a way to stimulate domestic investment and boost productivity is spot on. But his vehicle for doing that, the Trans-Pacific Partnership trade talks, looks creakier now that Washington, a critical TPP partner, may struggle to conclude a deal without trade-promotion authority from Congress.
Policy makers shouldn't govern by the wishes of stock markets, but in this case Mr. Abe could take a hint. If 2013 was the year when he hyped Japan's economic prospects, 2014 will need to be the year when he starts doing something about it.
http://online.wsj.com/news/articles/SB10001424052702303942404579360091631473678
Monday's slide in Tokyo stocks, which saw the Nikkei index fall another 2% to land 10% below its high little more than a month ago, can be explained different ways. Some blame the weak example offered by U.S. traders on Friday, a slowdown in Asian trading activity amid the lunar new year holiday, exchange-rate gyrations or merely ill-defined global skittishness. But there's no way around the pressure this development, on top of many others, puts on Prime Minister Shinzo Abe.
The stock market has offered arguably the most enthusiastic endorsement to date of Mr. Abe's eponymous economic revival program. In the six months after his election in December 2012, the Nikkei index rose nearly 60%. After a correction last May, it continued to climb.
This was taken, correctly, as a sign that foreign investors in particular were impressed by the rising corporate earnings Japan Inc. seemed to be generating under Mr. Abe. An asset-price surge became part of the Abenomics strategy, on the theory that rising stocks would fuel the positive sentiment Mr. Abe and his advisers believe is so important to reviving the real economy.
But investors are starting to take a more critical look at Mr. Abe's program. Coming weeks will tell whether the market is in a correction akin to the one it experienced last May or whether the balloon is deflating for good. But there's good reason to worry about the latter.
Take those high corporate earnings, which were mainly a result of Mr. Abe's weaker yen policy allowing companies to book higher yen-denominated profits on overseas sales—sales that are declining when measured by units shipped. This has yet to stimulate domestic wage growth, and may not do so.
Meanwhile the recent strengthening of the yen against the dollar raises questions about exactly how much longer this profit boost will last. Investors also worry about how corporate earnings will fare when Mr. Abe's consumption-tax hike takes effect in April.
Against these concerns, Mr. Abe's reform program remains unsatisfying. His so-called third arrow of domestic reform hasn't inspired enthusiasm because it omits key issues such as labor-market liberalization. His push to open the sheltered economy to imported goods and services as a way to stimulate domestic investment and boost productivity is spot on. But his vehicle for doing that, the Trans-Pacific Partnership trade talks, looks creakier now that Washington, a critical TPP partner, may struggle to conclude a deal without trade-promotion authority from Congress.
Policy makers shouldn't govern by the wishes of stock markets, but in this case Mr. Abe could take a hint. If 2013 was the year when he hyped Japan's economic prospects, 2014 will need to be the year when he starts doing something about it.
