Oil 1 Peak Oil 21
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Japan 1NCThe destructive force of hyper high inflation is a precursor for imminent economic collapse William Poole, President, Federal Reserve Bank of St. Louis, Global Interdependence Center (GIC) Abroad in Chile Conference, 5/5/07, Universidad Adolfo Ibáñez, Keynote Address, Santiago, Chile 2 Robert Barro. “Inflation and Growth.” Federal Reserve Bank of St. Louis Review 78 (3), May/June 1996, pp. 153-69. Perhaps the most obvious examples of the destructive force of inflation are hyperinflations in Germany after World War I, in various eastern European countries after World War II and in Latin America more recently. These were caused by printing money to finance massive government budget deficits. Hyperinflation was ended in those countries by reforms 11 that brought government spending under control and credibly ended the financing of deficits by printing money. Economists have debated whether the termination of hyperinflations resulted in serious declines in output. It is certain, however, that hyperinflation did not promote faster growth or financial stability. Hyperinflations went hand in hand with collapsing economies and financial markets. Inflation through the troubled energy sector represents a likely scenario for a malicious currency attack and armed conflict. Jodi Liss, International Affairs Professional Secretary/Executive Assistant at Liss and Lamar, P.C. and Student at Tulane University, 08, Making Monetary Mischief: Using Currency as a Weapon World Policy Journal 24 no4 29-38 Winter Third, the perceived relationship between politics and economics has become uncoupled, especially in industrialized countries, with less official oversight or control. And, fourth and finally, the rise of electronic banking and trading has increased the access and speed of transactions by millions of people, while the rise of offshore funds has put large sums of money out of sight of regulators. The increasing lack of transparency has made it difficult, if not impossible, to keep track of who is investing what or how much, or to prevent unseen actors from withdrawing at a strategic moment.(FN4) (The discovery that a rogue trader had pulled off a $7 billion fraud at Societé Generalé this past winter by hiding trades of European stock index futures shows, if nothing else, just how difficult it can be to keep tabs on financial transactions.) A currency attack could hypothetically start with a state or with a large non-state actor, such as a drug cartel or terrorist group. Its purpose could be to weaken a rival in anticipation of, or during, armed conflict; to punish another state for perceived economic, military, or political infractions; to hobble or distract a potential ally of an adversary; to cripple a potential competitor; or to attack or counterattack a stronger state that has substantial internal financial weaknesses. There are at least four scenarios in which a malicious currency attack might unfold. These include taking advantage of currency dependence; manipulation through a troubled banking sector; massive dumping of reserves of overvalued currency; and the use of rumor and innuendo to harm another state without actually doing anything. Japan Link FrontlineJapan’s expanding oil market is fueling import demand Lily Nonomiya, Staff Writer, International Herald Tribune, 10/13/05, High oil prices shrink Japan's surplus, http://www.iht.com/articles/2005/10/13/bloomberg/sxyen.php Japan's expanding economy is also fueling import demand. Mazda Motor and Mitsubishi Motors increased production in August, according to the Japan Automobile Manufacturers Association, creating demand for high-end steel products and the raw materials used to make them. Prices paid by Japanese steel mills such as Nippon Steel for iron ore have risen by 71.5 percent this year.Growing optimism about Japanese economic growth has also fueled demand for equities. The Nikkei 225 stock average rose 19.8 percent in the second quarter. Overseas investors bought ¥1.67 trillion of stocks in September, a separate report from the Finance Ministry showed, after purchasing ¥2.10 trillion of stocks in August. They sold ¥37.4 billion in bonds in September, the third consecutive month in which they were sellers of Japanese debt, the ministry said. Japan Link FrontlineHigh oil prices threaten Japanese trade surplus Lily Nonomiya, Staff Writer, International Herald Tribune, 10/13/05, High oil prices shrink Japan's surplus, http://www.iht.com/articles/2005/10/13/bloomberg/sxyen.php Japan's current account surplus narrowed for a second straight month in August, the government said Thursday, as rising oil prices and domestic demand drove up imports. The surplus shrank 15.6 percent from a year earlier, to ¥1.22 trillion, or $10.6 billion, the Ministry of Finance said. The current account is the broadest measure of trade, tracking the flow of services and investment income from overseas in addition to goods. A narrower measure, the trade surplus, measuring the difference between imports and exports of goods, shrank 69 percent to ¥233 billion in August, its 10th consecutive decline, Thursday's report said. Japan Link ExtHigher Prices make Japanese imports more expensive while raising demand Lily Nonomiya, Staff Writer, International Herald Tribune, 10/13/05, High oil prices shrink Japan's surplus, http://www.iht.com/articles/2005/10/13/bloomberg/sxyen.php Rising oil prices are increasing the value of Japan's imports, which are also climbing because the economic recovery is fueling domestic demand," said Azusa Kato, an economist at BNP Paribas Securities Japan. Kato expects the economic expansion to keep spurring demand for imports, "preventing the surplus from widening." Imports rose 10.6 percent to a record ¥4.7 trillion in August from ¥4.25 trillion in July, the report showed. Exports climbed 8.8 percent, their fastest pace of growth since November, to ¥4.97 trillion. The yen fell to 114.79 per U.S. dollar after the report's release, its lowest level in Tokyo since May last year, from 114.38 late Wednesday in New York. "An increase in oil imports means more demand out of Japan for the dollar to buy them," said Osamu Takashima, chief analyst of the foreign-exchange and treasury division in Tokyo at Bank of Tokyo-Mitsubishi.
The business is already in decline due to dwindling fish stocks. Japan Tuna, an industry group, said the cost of heavy fuel for long-range tuna ships had doubled over the past year to Y120,000 ($1,137, €733, £576) a kilolitre. It said 20 per cent of Ja-pan's fleet of 360 ships might suspend operations during July to October, when catches tend to be lowest.
Blunt but Potent Economic weapons, of course, are blunt instruments: a currency attack is an act of violence against a state's infrastructure, one whose effects cannot be necessarily limited, guided, directed, or controlled. In an interconnected world, the attacker, or other countries, may end up being harmed by the financial fallout as much as the target. And any state or non-state actor that wanted to use currency as a weapon would face significant execution problems, from gaining access to vast sums of money to coordinating how and when to pull the trigger. Currency is not like guns and bombs, but it can be an extremely useful weapon in certain circmstances. It is efficient and comparatively inexpensive, and it can weaken or cripple a targeted state in its ability to function, much less to maintain its own security. A currency attack at the precisely right (or wrong) moment may help push a state in a destructive direction, or may weaken an opponent already besieged. Directory: file -> view view -> Western Europe after wwii view -> Author study: paul fleischman view -> Qpa1 7ela study Guide view -> Arctic Oil/Gas Neg view -> November 1970 Approximately 150,000-500,000 deaths Bhola Cyclone Bangladesh view -> Grade Level: 6 Unit of Study: Caribbean glce view -> Citation: Duffield, Katy view -> Table of Contents Lesson # view -> Chinese Wind Energy Disad Download 9.54 Mb. Share with your friends:
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