Seoul, Beijing Find New Common Ground Against Tokyo

Discussion in 'Indo Pacific & East Asia' started by t_co, Nov 20, 2013.

  1. t_co

    t_co Senior Member Senior Member

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    Korea, China Find Common Ground Against Japan With Monument of Korean Hero Ahn Jung Geun in Harbin - China Real Time Report - WSJ

    Together, China and Korea hold nearly 300bn USD in Japanese government bonds. Abenomics is also weakening. If Japan continues its intransigence on territorial and historical issues, China and Korea can team up to dismantle the ability for Japan to finance its national debt right when Japan's recovery is most fragile.
     
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  3. t_co

    t_co Senior Member Senior Member

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    Bond Wars: Chinese Advisor Calls For Japanese Bond Dump | Zero Hedge

    Korea is the second largest foreign creditor of Japan.
     
  4. t_co

    t_co Senior Member Senior Member

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    The planes and weapons of the PLAAF and PLAN are a sideshow.

    Confidential analysis done by global banks indicates there is no feasible way to deter China from triggering the default/devaluation choice for Japan. If Japan defaults, all Japanese banks would go bankrupt; Japanese citizens would lose their life savings; bank runs would occur; the economy would grind to a halt as Japanese firms lost access to credit.

    So Japan will devalue; Japan would have to use its foreign reserves to buy fuel and natural resources, triggering further weakness in global financial markets. America could intervene by trying to prop up the yen, perhaps with swap lines, but that would simply link the dollar to the default/devaulation choice and share Japan's economic pain with America. It is unlikely America would engage in such a choice willingly, not while Obama and the Republicans face a high unemployment rate and mutual unpopularity. Since economic duress is not covered by the US Japan security treaty, the US would likely walk away from Japan's mess by imposing capital controls on the yen (a move China is likely to bring up even if the US doesn't - and a move global economies will have massive incentives to support, lest their debt markets collapse next), and therefore force major economies around the world to cut themselves off from Japanese trade to avoid catching the default/devaluation cold (since trade with Japan implies accepting Japanese financial flows). China's move, therefore, would force the US to either impose de facto economic sanctions on Japan (a la Iran) while it tried to fix its debt bubble or suffer massive economic losses to try and save foreigners in the middle of a US election season.

    If Japan loses the ability to trade, it is game over as Japan does not have natural resources or energy on the Home Islands. More than that, Japan only has 50 days worth of animal protein on the island, 40 days worth of cooking oil, and imports over half of those two basic food ingredients. Japan does not have sufficient pharmaceutical feedstock to manufacture basic medicines alone, either. Japan would fall into subsistence diets relatively quickly; disease would spread; then China (with the largest holdings of yen outside of Japan) could step in as the merciful 'big brother' and offer to get Japan back on its feet... but on Chinese terms. East Asia would become China's, without China ever firing a shot.

    This is why Abe's moves should seem so foolhardy. He is literally taunting two actors with the ability to cripple his economy with impunity and permanently reverse his national security situation. Japanese citizens deserve better leadership; leadership that learns to tread lightly.
     
  5. amoy

    amoy Senior Member Senior Member

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    Ahn Jung-Geun

    The 1st movie I saw on TV (as far as I can remember) was a Korean one. It impressed me very much but I couldn't understand the story since I was a child then. Later on I knew the movie was about http://en.wikipedia.org/wiki/Ahn_Jung-geun assassinated Ito ex Japanese PM in Harbin China.

    Anh's calligraphy is quite good!
    [​IMG]
     
    Last edited: Nov 20, 2013
  6. t_co

    t_co Senior Member Senior Member

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    Anh is a Korean patriot, and a true hero to all East Asians.
     
  7. Ray

    Ray The Chairman Defence Professionals Moderator

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    Surprising that South Korea inspite of finding common grounds with China are flying their military aircraft in the newly declared the so called Chinese ADIZ along with Japan and the US!

    Funny way to find common ground.
     
    W.G.Ewald likes this.

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