Charissa Yung shakes her head as she flips through the latest issue of Time magazine.
What's raising her blood pressure is an item headlined "Japan's Sob Story." It explores the nation's steady economic demise. "Things just seem so depressing in Japan," says the 33-year-old graphic artist. "Is the place really falling apart?"
It's a big question for Singapore's 4 million people and for the world's economy watchers. It's also one that's far from being answered. The best and brightest minds can't say whether Japan's economy will implode, explode or just muddle along for a few more years.
Singapore's Business Times newspaper even carried a story yesterday asserting that Japan eventually may need the help of the IMF. The piece, which quotes unnamed sources, seemed far-fetched indeed. Yet it's hard to refute the idea that Japan has deteriorated markedly since 1997 -- the last time Tokyo dismissed speculation it may need IMF aid.
If only going to the IMF were an option for Japan at some point, that might give its neighbors hope that a safety net stands between them and Tokyo's worsening problems. Trouble is, Japan isn't too big to fail -- it's too big to save. If South Korea needed US$57 billion in 1997, what might the world's second-biggest economy require? Even the best-case scenario -- Japan, an extraordinarily wealthy nation, continues to plod along at negligible growth rates -- is hardly good. That doesn't mean Singapore and its Asian neighbors aren't fearing the worst: a full-blown banking crisis that sends shockwaves through the region.
"If there's a crisis from Japan then it could have a great impact on the Asian economy," Jin Nyum, South Korea's finance minister, said in a Jan. 25 interview.
There are myriad reasons to think Japan won't fall off a cliff, taking Asia with it. Its financial system is still functioning -- and can continue to -- because the money still flows. Even if Japan doesn't fix its economy, it still can borrow enough money, print plenty of yen and draw on sufficient household wealth to hold things together.
That's little comfort for Japan's neighbors. It doesn't help that Japanese politicians are readily speaking out about an imminent crisis.
"I think the chances are increasing," Taro Aso, chairman of the ruling Liberal Democratic Party's policy research council, said Monday.
President George W. Bush is in Tokyo this week trying to make sense of things. It should be a sobering experience for Bush, who Monday called Prime Minister Junichiro Koizumi a "great reformer." Koizumi will no doubt revel in the observation, but one wonders if Bush is getting reliable intelligence reports. Koizumi hasn't reformed a thing, and there's little chance he ever will.
No one's under the illusion that Bush's meetings with Koizumi will feature nuts-and-bolts discussions about Japan's banks. Yet it might be wise for the US president to take a harder stance toward Japan's perpetual malaise.
Calling Koizumi a great reformer only serves to boost his Liberal Democratic Party's spin machine. The LDP wants the public to think it's for change; Bush provided the perfect sound bite. Bush should've called Koizumi the "great pretender," given that he's only acted the part. Yet Bush's support shouldn't be dismissed.
Koizumi's extraordinary approval ratings took a hit after he sacked his popular foreign minister, Makiko Tanaka. Around the same time, markets -- quite belatedly -- seemed to realize his reform drive is going nowhere. Bush's blessing may help Koizumi.
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