As the United States seeks to finance its ballooning budget deficits by printing more US dollar bills, Japanese economists are increasingly concerned that the excessive use of dollar seignorage by US financial authorities will further shake confidence in the US currency at a time when the world lacks an alternative globally accepted currency.

The US government projects that even without the forthcoming US$825 billion fiscal stimulus package, the national budget deficit to September 2009 will be $1.19 trillion, the biggest since World War II, or 8.3% of gross domestic product (GDP). This amount is likely to grow as the US government continues to rescue failed parts of the economy. How will the US cope with its enormous and growing debt obligations?

2008 was a rollercoaster year for those in the oil and gas industries. In July crude oil prices hit US$147 a barrel in the wake of attacks on Nigerian oil installations, before receding to under US$40 in December after months of economic decline in most major consuming countries. Weaker economies and record high prices have seemingly reduced worldwide demand and burst the speculative bubble in commodity prices. For those in government and business tasked with strategic planning such pricing movements make their jobs extremely challenging. Indeed, despite extensive research by the World Bank, analysts remain unsure if future oil prices will ever again climb above US$100 per barrel.

Japan Focus first reported in May 2006 that 300 Allied prisoners of war performed forced labor for Aso Mining Company in 1945. (See English and Japanese versions.) The ensuing Aso POW controversy led then-Foreign Minister Aso Taro to hastily withdraw an invitation to a POW memorial service near Osaka that he had issued to foreign ambassadors, as reported in August 2006. When a New York Times reporter mentioned forced labor at Aso Mining in November 2006, the Japanese government launched a counteroffensive. (See English and Japanese versions of Norimitsu Onishi's article.) The Consulate General of New York, reportedly at Foreign Minister Aso's direction, published an online rebuttal (reproduced below with a Japanese translation) insisting that the news article was not grounded in historical evidence. A 1946 report produced by Aso Mining, detailing living and working conditions for the POWs, was mailed to Foreign Minister Aso's office in June 2007. (See English and Japanese articles about the report and the English version of the document itself.) Aso's policy secretary was subsequently interviewed about the POW records at length (see English and Japanese accounts), but the prime minister stated in parliament earlier this month that the records were never brought to his attention.

The economic outlook in Japan is very grim, as these brief overviews (links below) indicate. Right now, Japan has the worst growth outlook in Asia. That is a surprising fact, if one recalls that this is a country presumably dusting itself off from the collapse of its own bubble nearly two decades ago. After such a long period of economic crisis, Japan should be renovated and ready to thrive. But instead, it may be in worse shape than even the US (though clearly not Iceland and much of Eastern Europe). Japanese financial institutions were not big players in the CDOs, CDSs and the other toxic assets that have ravaged the capital bases of banks in the US and much of Europe. Rather, Japan's key policy failure would appear to be over-reliance on exports as the engine of growth, while hoping that the fruits of this growth would trickle down into the rest of the economy and bolster demand. But in the rest of the economy, deregulation of labour and other markets had seen firms shifting to insecure employment (especially part-time and contractual staff) and rolling back pay, thus crimping the level of demand. And that weak domestic demand was of course blunting domestic-oriented businesses' incentives to invest (cf. export-oriented businesses' incentives to invest). With the startling 35% drop in exports in December 2008, it's as if someone kicked the chair away from a man who was standing on one to test out what it felt like to have a noose around his neck.

In the course of a forty-five year career, Honda Katsuichi has established himself as one of Japan's, and the world's, premier investigative journalists and authors. Hailing from a mountain village in Shinshu (Nagano) and an avid mountain climber throughout his life, Honda's interests extended from nature and the environment to the politics of colonialism and war, with the Vietnam War as a critical moment in his development. In writing for the Asahi Shimbun and in a series of best-selling books, Honda has addressed the most controversial contemporary and historical issues confronting Japan as well as the United States and others. Most famously, he “broke” the Nanjing Massacre story in Japan thirty-four years after the event with first-hand interview reportage from China. His reportage and his book, Nankin Daigyakusatsu, published in English as The Nanjing Massacre: A Japanese Journalist Confronts Japan's National Shame inspired a generation of Japanese, Chinese and international researchers who have excavated the Nanjing Massacre. It also touched off fierce polemics in the form of a Nanjing Massacre denial literature.