The Arrival of a New Age
The financial crisis that originated in the United
States spread around the world like wildfire.
In just the second week of October share prices
plummeted by 50% worldwide, triggering the kind
of economic crisis that is said to occur only
once in a century. Even now, the economy is in
recession. Government leaders have begun frantically
searching for countermeasures, but observers are
saying that it will take several years to recover.
The main culprits who brought about the economic
crisis are market fundamentalism and the hedge
funds. These people only make money by controlling
the swings in share prices and commodity prices,
and in the end it was they who caused the world
Even before the crisis actually occurred, the
subprime loan problem in the United States was
having an impact on finance around the world.
At the root of this problem were hedge funds,
which make profits by scalping. The hedge funds
directed their money toward crude oil, pushed
up the price of crude oil, and caused a rise in
the price of other materials as well, thereby
plunging otherwise healthy manufacturing industries
into despair. The hedge funds measure corporate
value in terms of return on equity and make a
quick buck from short-term market fluctuations.
What the latest economic crisis means is that
the economy is shifting from market fundamentalism,
which makes it easy for these hedge funds to secretly
maneuver, to a form of capitalism that reflects
the real economy. The difficult period is probably
going to continue for a while, but I sincerely
hope that this new form of capitalism will be
realized and that hedge funds and the like move
in the direction of regulation.
Incidentally, looking at companies that have been
caught in the latest financial crisis, we see
that while the American International Group (AIG)
was rescued, Lehman Brothers was not bailed out.
These are both global companies employing several
hundred thousand workers, so their bankruptcy
would be sure to have an enormous impact on the
The people who used Lehman Brothers were investors;
naturally, hedge funds were the company’s
main clients as well. The mentality of investors
is to put priority on their own profits rather
than thinking of others. That is the common practice,
so the response is to tell these people to take
responsibility for their own speculation. It would
be outrageous to come to their rescue with taxpayers’
money. By the way, it is probably still fresh
in readers’ memory that when Livedoor made
a move to purchase TBS, it was Lehman Brothers
that arranged the funds. Lehman was acting like
a real hedge fund at that time, and its eventual
bankruptcy is only natural.
AIG, on the other hand, is a life insurance company.
People take out insurance for the future and seek
peace of mind, so it would be catastrophic if
this firm went under. AIG was rescued by the government’s
policy of protecting individual deposits and insurance.
The world economy is probably going to become
even more severe: slump in personal consumption?decreased
sales?decreased production in factories?a further
decrease in sales?bankruptcies, layoffs, employment
instability, a rise in the unemployment rate?consumers
go on the defensive?a further slump in personal
consumption?a worsening of the real economy.
As a result of this chain, the economy is certain
to be in the doldrums for a while, and it is necessary
to quickly adopt countermeasures that take account
of this situation. In particular, the nosedive
in share prices strikes a direct blow on the disposable
income of the rich, so the impact on expensive
goods could be considerable.
In these circumstances, the digital household
electric appliance business is perhaps in a somewhat
fortunate situation compared with other industries.
Eagerly looking forward to the arrival of an age
that has its feet firmly on the ground, I hope
that we can enliven the year-end sales campaign.