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2010年5月 9日 (日)

世界同時株安 ギリシャ危機の飛び火を防げ

The Yomiuri Shimbun (May. 9, 2010)
Prevent Greek crisis from spreading further
世界同時株安 ギリシャ危機の飛び火を防げ(5月8日付・読売社説)

Financial markets around the world are still shaken by the troubles in Greece, even though European countries and the International Monetary Fund have decided to extend financial assistance of up to A110 billion (about 13 trillion yen) to the country, which is struggling with a serious fiscal crisis.

Selling ballooned on the New York Stock Exchange on Thursday, mainly due to fears over the adverse effects of Greece's fiscal deficit. This, coupled with a sudden plunge in the market that is believed to have been caused by a trader who mistyped an order to sell a large block of shares, briefly pushed the Dow Jones industrial average below 10,000.

Affected by the New York sentiment, the Tokyo market was down across the board Friday, causing the Nikkei Stock Average to drop more than 400 points at one point.

Other major Asian markets such as Shanghai and Hong Kong also plunged, a situation that could be dubbed a spontaneous global market crash.


Not 'fire on the opposite shore'

Even for Japan, the European-born trouble for which Greece is basically responsible cannot be considered a "fire on the other side of the river," a Japanese expression for events that can be observed casually. Japan too needs to be on high alert, so as not to be burned by sparks drifting over from the crisis.

The assistance package from the IMF and the European Union is being extended on the condition that Greece implement measures to rebuild its public finances, including raising the rate of its value-added tax and of its taxes on luxury items, and cutting the salaries of public employees.

However, citizen demonstrations opposing the measures have intensified and even resulted in deaths. The chaos over fiscal rehabilitation within the very country at the center of the problem has been growing serious.

Within the countries who decided to extend a helping hand, including Germany, prevailing public opinion is against the increased burden expected to result from the aid package. This has begun to fray the unity within the eurozone toward resolving the problem.

The Greek crisis has had a ripple effect in markets in Spain and Portugal, which hold huge fiscal debts similar to that of Greece. People strongly fear confidence in the single currency of the euro may be undermined. Such psychological anxiety probably hit the stock markets hard.


G-20 too optimistic

The Group of 20 meeting of finance ministers and central bank governors held in April in the United States did not probe deeply into the Greek fiscal problem.

The finance chiefs may have concluded the problem should be left to the IMF and eurozone nations. We think this judgment was too optimistic.

Speculators may have taken advantage of this opportunity. Group of Seven and G-20 nations hereafter need to formulate countermeasures to deal with the situation more seriously.

Japan, still anxious over its own struggle toward economic recovery, also has a worsening fiscal problem.

Ninety-five percent of its national bonds are held in a stable manner by domestic investors, a situation quite different from Greece, where 70 percent of its national bonds are held by overseas investors.

However, the Greek economic chaos was triggered as its national bond rating was lowered. This country should see the Greek crisis as a valuable lesson to avoid a similar outcome.

What is most hurting the Japanese economy's confidence is the economic policy of the administration of Prime Minister Yukio Hatoyama, which continues to dole out huge funds without showing a clear road map for fiscal rehabilitation. This needs to be addressed first.

(From The Yomiuri Shimbun, May 8, 2010)
(2010年5月8日01時07分  読売新聞)


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