Well, it wasn't just last year. Here is the pattern over the last several years, since Clinton became president. In 1993 Treasury Secretary Bentsen declared that he wanted a "strong yen." The yen began to rise against the dollar pretty steadily, reaching in mid-1995 a level of 79 to the $. Then, after a decline in US interest rates, Treasury Secretary Rubin did a stealth market intervention and the yen began to fall, reaching 147 to the $ in mid-1998, at which time Rubin engineered another stealth intervention to halt the slide of the yen. It has been rising ever since, pretty much.
Now, throughout this whole period the Japanese economy has been in a slump and the US economy has been more or less booming. The recent uptick of the Japanese economy is just an excuse for these tendencies to speculative trends. And, also, throughout this whole period, the "Japanese have owned our sorry asses."
So, of course now people are wondering if and or when Larry Summers will pull a stealth intervention and whether or not it will "work," that is turn the long term trend around again. Hey, "the market" is "getting nervous" as the almight $ nears 100 yen to the $, oo oo ooooh. (Of course all those past stealth interventions involved coordination with the Japanese. Not clear they are willing/able to do so right now or anytime soon.... ). Barkley Rosser -----Original Message----- From: Dennis R Redmond <dredmond at OREGON.UOREGON.EDU> To: lbo-talk at lists.panix.com <lbo-talk at lists.panix.com> Date: Friday, September 24, 1999 3:23 AM Subject: Re: Americanization of global finance (cont.)
>On Thu, 23 Sep 1999, J. Barkley Rosser, Jr. wrote:
>
>> As a followup to a rather long message on this
>> I just sent: Japan "owned our sorry asses" last
>> year, but the yen was falling then. Why?
>
>You said it yourself: irrational short-term speculation. Markets are by no
>means the streamlined monuments to curvilinear perfection the neolibs and
>squawk hawks lining CNBC make it out to be. They bounce around all the
>time, just like capitalist society itself: constantly in motion. But
>there are indeed long-term trends in the churn.
>
>Plus, Japan's economy was still shrinking last year, and has stabilized
>this year.
>
>-- Dennis
>
>