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2008年10月 8日 (水)


(Oct. 8, 2008) The Yomiuri Shimbun

Enough economic talk, it's time for tough action

世界同時株安 政策協調で強力な対策を(108日付・読売社説)

Stocks around the world are going into free fall as the U.S.-triggered financial crisis goes from bad to worse. The international community should not dawdle in coordinating policies that will be highly effective, including emergency cuts in interest rates by Japanese, European and U.S. authorities.


New York stocks fell below 10,000 for the first time in four years Monday. Tokyo stocks briefly dipped below the 10,000 threshold for the first time in four years and 10 months Tuesday. Other Asian markets as well as European markets also have seen falls in stock prices caused by a chain reaction.


On the foreign exchange market, the yen rose as the dollar briefly hit the 100 yen level. The Japanese currency also sharply rose against the euro. Market players are jittery. It is anyone's guess when these panic-stricken falls in stock prices and turbulent fluctuations in exchange rates will end.


The latest confusion in financial markets was, somewhat ironically, caused by the U.S. government's bailout package that was finally signed into law Friday. Due to doubts over the effectiveness of the package, selling pressure gathered pace in stock markets.


Concern over such factors as the financial crisis spreading into Europe and the slowdown of the U.S. economy also took the wind out of the markets' sails.



U.S. rescue package flawed

The bailout package allows the injection of up to 700 billion dollars in public funds to buy up bad loans held by financial institutions. The package was expected to serve as a trump card to rescue financial institutions that are in dire situations.


However, observers believe it will be difficult to determine at what prices bad loans are to be bought up, and it likely will take time for the package to produce tangible results. Many pundits say the U.S. government should use public funds also to beef up the capital of financial institutions. The package, however, does not include such a measure.


Even if the U.S. government is set to establish a new law to enable capital injections, it cannot take actual steps because the Congress is closed ahead of the election season. This is a serious situation.


In Europe, into which the crisis has seeped, emergency lending has been offered for imperiled German lender Hypo Real Estate. The German government also announced it would guarantee all private deposits. Since a number of banks and other financial institutions have been found to be treading water, other nations also are being driven to take action to rescue them.



G-7 meet in spotlight

At a summit meeting of four major European nations last weekend, however, the leaders failed to hammer out any effective measures to alleviate this difficult situation. A plan to create a rescue fund to buy up bad loans, similar to the U.S. bailout package, has been shelved.


Observers have pointed out that systems to monitor and support financial institutions that operate globally are far from satisfactory. We think steps to rectify the situation should be taken as soon as possible.


Japan, which is increasingly seeing signs of an economic recession, has been dealt the double punch of an abrupt slowdown in the U.S. economy and the appreciation of the yen. The nation probably should start considering implementing additional measures to sustain its economy.


A focal point for now is the meeting of finance ministers and central bank chiefs of the Group of Seven major nations that is scheduled to be held in Washington on Friday. The finance leaders need to send a strong message to avoid a crisis.


Market players are pinning their hopes on coordinated cuts in interest rates by Japanese, European and U.S. monetary authorities. Whether they will make such a decision will be closely watched.


(From The Yomiuri Shimbun, Oct. 8, 2008)

20081080152  読売新聞)


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