The rest of Asia also is hoping to export its way out of recession.
But if the US hits a wall -- which is far more possible today than yesterday -- Asia will have to look elsewhere. That risk grows if the Dow follows the Nikkei's lead and plunges when New York markets reopen tomorrow. Some analysts are even buzzing about a Federal Reserve rate cut as soon as yesterday. The move would be aimed at calming fears about a US meltdown.
US Treasury Secretary Paul O'Neill, who was stranded here in Tokyo earlier yesterday, already is going through the motions. "In the face of [Tuesday's] tragedy, the financial system functioned extraordinarily well, and I have every confidence that it will continue to do so in the days ahead," said O'Neill, who called US financial markets "strong and resilient."
Such reassurances are coming in Asia too. The Bank of Japan today added an extra ?2 trillion (US$16.8 billion) to the world's second-biggest economy. The move was aimed at keeping markets functioning smoothly. Central bankers from Australia to Hong Kong to Korea to Singapore pledged to do the same. The Reserve Bank of New Zealand also is keeping tabs on things.
It's comforting to see policymakers are awake at the controls.
Economics courses don't include much instruction on dealing with the financial repercussions of terrorist attacks. Perhaps they'll begin to, considering officials are now faced with those very challenges as never before. For not only has the world changed in the last 24 hours, but so has the range of variables economic authorities need to keep on their radar screens.
In the meanwhile, we here in Asia will keep victims and families in New York and Washington in our thoughts. I can't speak for everyone, but my heart is certainly 12,800km away from Tokyo at the moment.
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