Debt forces Maldives to pivot back to India from China – Asia Times

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The Maldives, known for breathtaking resorts and serene beaches, is battling an escalating debt crisis and attempting a delicate balancing act between its two largest creditors: India and China. As the island nation braced for an impending debt default, President Mohamed Muizzu’s leadership will be tested by how he steers his country through this turbulent economic and geopolitical landscape.

As of August 2024, the Maldives’ foreign currency reserves totaled $437 million, which could cover only about a month and a half of import bills. The country is projected to arrange $600-$700 million of debt service expenses in 2025 and more than $1 billion in 2026. The island nation owes China about $1.3 billion and India about $130 million.

Against this backdrop, the Maldives president met Indian Prime Minister Narendra Modi in New Delhi on October 7, in a bid to secure much-needed financial assistance, amid fears that the island nation may default on a crucial $25 million bond payment. Reuters reported that India approved a $400 million currency swap agreement, a much needed lifeline for the debt strapped country of half a million people in terms of accessing short-term liquidity.

Maldives debt troubles are related to Sukuk bonds. Sukok is a special type of financial instrument that is often referred to as an Islamic bond, which operates quite differently from conventional bonds in order to comply with Islamic principles, particularly the prohibition of interest.

Unlike traditional bonds, which are debt instruments setting out that investors have lent money in exchange for interest payments, Sukuk represents ownership in a tangible asset or a pool of assets. Investors receive returns not from interest but from the revenue generated by the asset. If Maldives default on its Sukuk debt, that will be the first such event of sovereign default for Sukuk.

Absent much needed financial rescue from the likes of India, the ramifications of Maldives missing its Sukuk payment would be devastating: it could block access to international capital markets, shake investor confidence, and tip the Maldives into deeper economic turmoil.

While the Maldives with the latest assurances of help from India may have avoided an immediate default on its Sukuk debt, the country’s broader economic troubles remain unresolved, with significant debt payments looming in the coming years.

Geopolitical rivalries, structural weaknesses

The Maldives’ economic distress is deeply intertwined with the geopolitical rivalry between two major players in the region, India and China. Over the past decade, the country has borrowed extensively from both nations, but the two offer assistance with different goals in mind.

China’s loans have largely funded infrastructure projects tied to its Belt and Road Initiative, helping Beijing expand its strategic footprint in the Indian Ocean. India, on the other hand, sees the Maldives as a critical part of its regional security and has provided financial aid to counter China’s growing influence.

President Muizzu in his ‘India Out’ T-shirt. Photo: X

Muizzu’s rise to power in 2023 was underpinned by an “India Out” campaign, aimed at reducing the Maldives’ reliance on New Delhi and drawing the country closer to Beijing.

On his way to electoral victory, Muizzu promised that, once elected, he would expel Indian soldiers who were deployed in the Maldives on humanitarian assistance engagements.

Bowing down to such political pressure, India replaced dozens of its soldiers – exchanging them with civilian experts. However, as Maldives continued its plunge towards a debt crisis, shortly after coming to power, President Muizzu’s government caved in to pragmatism and softened its stance toward India, recognizing that Maldives’ immediate survival hinges on securing financial support from both China and India.

Maldives’ real challenges lie in its unsustainable debt burden and the structural vulnerabilities that underpin its economy. The country is overwhelmingly dependent on tourism, an industry highly susceptible to global economic shocks, as evidenced by the downturn following the Covid-19 pandemic. Furthermore, Maldives imports most of its essential goods – and rising global commodity prices have compounded its financial woes, draining foreign reserves and making it even harder to service debt.

This situation places the Maldives in a precarious position between the two competing powers. India and China both have significant economic and strategic interests in the Maldives, and their financial aid comes with expectations.

For China, the Maldives is an important link in its maritime strategy, while for India, the Maldives represents a key part of its efforts to counterbalance Chinese influence in the region. As President Muizzu navigates these tricky diplomatic waters, he must find a way to secure financial support without compromising the country’s sovereignty.

As for India, there are strong incentives to take President Muizzu into its fold, given that India sustained a series of diplomatic setbacks as several pro-India governments lost power in South Asia recently.

In Sri Lanka, a marxist politician, Anura Kumara Dissanayake, became president. In Bangladesh, Prime Minister Sheikh Hasina, arguably the most Pro-Indian Prime Minister in Bangladesh’s history, fled to India after being forced to resign by student-led protests. In Nepal, K.P. Sharma Oli, a pro-China politician, was elected as prime minister.

Reversing any of the recent diplomatic failures in India’s backyard will be viewed as a political victory for Indian Prime Minister Modi.

The goal: long-term solutions that leave sovereignty intact

The Maldives’ economic problems are structural, and addressing them will require more than temporary currency swaps and loans. The country needs a comprehensive strategy to diversify its economy away from tourism and reduce its dependency on imports, but such changes will take time – and political will.

The Maldives’ government has proposed several measures to address the crisis, including tax reforms, budget cuts and the restructuring of state-owned enterprises. These proposals aim to improve fiscal discipline and reduce the reliance on external borrowing. Yet, implementing these reforms will be a daunting task. Austerity measures such as tax increases and public service cuts have historically triggered protests in the Maldives, and Muizzu’s government may face significant resistance to these changes.

The question of whether the Maldives will turn to the International Monetary Fund (IMF) for a bailout also looms large. Although the government has thus far resisted this option, citing the temporary nature of its financial difficulties, many experts believe that an IMF intervention may be inevitable if the debt crisis worsens. However, an IMF bailout would come with stringent conditions including further austerity measures that could exacerbate social unrest and hurt the economy in the short term.

Unlikely to have a long term solution ready at hand, the Maldives will continue to depend heavily on India and China for financial support. But this dependence will come at a cost as both these regional powers are likely to use their financial leverage to push for greater political influence in the country.

India may seek to use its financial assistance as a way to reassert its strategic interests in the region, while China could leverage its economic investments to secure long-term control over key infrastructure projects.

The danger of this approach is that it could undermine the Maldives’ sovereignty. While financial support from India and China may help the Maldives avoid an immediate default, it risks entangling the country in the broader geopolitical rivalry between the two powers – thus endangering its own security. The delicate balancing act necessary to handle this geopolitical quicksand will require President Muizzu to be both a shrewd diplomat and a careful economic planner, as the stakes could not be higher.

A template for other small nations to follow?

The Maldives’ debt crisis is a cautionary tale for small nations that rely heavily on foreign loans and single industries such as tourism. Without a long-term plan for economic diversification and debt restructuring, the country will remain vulnerable to financial instability and external shocks.

President Muizzu’s recent mending of ties with India in exchange for accessing capital reliefs offers only a temporary solution, as it is not a substitute for the broader reforms that are needed to stabilize the economy.

The political cost of these reforms could be significant, but the alternative – continued dependence on foreign loans and increasing debt – is far more dangerous. To prevent a deeper crisis, the Maldives will need to enact tough but necessary reforms, build its foreign reserves and explore new sectors for economic growth.

President Muizzu must know that bold actions are needed at this critical juncture of his country’s national history. It is his time to take decisive actions to secure its financial future or risk being drawn deeper into the geopolitical currents that threaten to pull it under.

In a region marked by rising competition between India and China, the Maldives’ next moves could set a precedent for how small, debt-ridden nations handle the delicate balance between economic necessity and political independence.

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China hits back at EU with brandy tax

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In a move that France has claimed is retaliation for new high tariffs the Union announced on Foreign electric vehicles, China has imposed duties on imports of European brandy.

The European Commission said it would challenge China’s tax at the World Trade Organization ( WTO ), calling it an “abuse” of trade defence measures.

French cognac producers said the tasks would be” fatal” for the business.

Hennessy and Remy Martin will be among the major companies affected by the Chinese walk.

Shares in vodka firms dropped after the announcement.

China announced new restrictions on European brandy just days after EU countries approved steep tariffs on Chinese-made electric vehicles.

China’s business ministry said the cognac imports threaten” large harm” to its own producers.

It also said it was considering a climb in tariffs on exports of large-engine cars, which had struck European manufacturers hardest, and meat and cheese products.

Following the European Union’s decision to raise tariffs on Chinese energy cars, French Trade Minister Sophie Primas described the brandy move as” seeming to be a punitive measure.”

She said that kind of retaliation would become “unacceptable”, and a” full contradiction” of international business laws, adding that France may work with the European Union to take action at the WTO.

France accounts for 99 % of brandy exported to China, and French cognac lobby group BNIC said the move would be” catastrophic” for the industry.

According to BNIC,” the European authorities never reject us and keep us alone to deal with Taiwanese retribution that has nothing to do with us.” The taxes “must be suspended before it’s too late.”

After the Taiwanese news, shares in companies that sell spirits suffered a blow.

Luxury firm LVMH, which produces Hennessy, fell more than 3 %, while Remy Cointreau, which makes Remy Martin, fell more than 8 %.

According to analysts at Jefferies, the tariffs could cause consumers to pay 20 % more, which would likely cause levels and supplier selling to decline by a fifth.

Stocks in German carmakers, which could also be hit by hostile moves from China, even slid.

Ford, Porsche, Mercedes-Benz and BMW were all over after the news.

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Xi knows what it takes to sustain China’s rally – Asia Times

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Last year, as Chinese shares produced their biggest obtain since 2015, Lu Ting, general China analyst at Nomura Holdings, was warning investors not to forget another, more tragic memory from that same time.

The risk of repeating the amazing boom and bust of 2015 was fall quickly in the coming months, Lu information.

Lu adds that in a worst-case situation,” a stock market madness had been followed by a fall, similar to what happened in 2015″. He continues,” We wish Beijing could be more calm, while investors might still be Sure to partake in the growth for the time being.”

But alcoholism does appear to be returning, and more quickly. Though perhaps not Lu’s” accident” situation, family names like JPMorgan Asset Management, HSBC Global Private Banking and Invesco Ltd. are also advising precaution. Invesco, for one, worries coast stocks are “really overvalued”.

This is very questionable, of course. Consider the financial giants Fidelity International, an investment company, among those who also see a lot of value in mainland shares after years of losses totaling many trillions of US dollars.

Goldman Sachs Group, to. If the government fulfills its promise regarding stimulus measures, the Wall Street giant now has an overweight view of mainland shares with a 15-20 % potential for growth.

Current policy decisions by Beijing, according to Goldman strategist Tim Moe, “have led the marketplace to think that policy makers have become more concerned about taking enough action to reduce left-tail growth risk,” the market believes.

BlackRock has not reaffirmed its bearish position on Chinese stocks in the past. In light of how attractive prices had become in relation to peers in the developed-market, as its managers wrote on October 1:” We see room to turn quietly big Chinese shares in the near term.”

Despite this, Xi Jinping’s state had continue to pay attention to the fact that foreign investors have debated how much China has actually advanced since 2015. Shanghai stock lost a second of their value in just three months in that year. Beijing’s response last week to plunging shares was n’t nearly as overwhelming as after the July 2015 stumble.

A week ago, the People’s Bank of China cut borrowing costs, slashed businesses ‘ supply need numbers, reduced loan rates and unveiled new market-support resources to put a floor under share prices. Additionally, proposals for strong fiscal stimulus measures are being considered.

In the days that followed, Chinese stocks skyrocketed. Some sobriety had returned by the week’s end and into Monday, though, as traders began to wonder how many things Xi’s team had learned from 2015.

More troubling, is perhaps what they did n’t. In other words, addressing the symptoms of China’s challenges with waves of liquidity is no substitute for supply-side reforms that address the underlying issues.

In China, circa 2024, the biggest ailment is a property crisis that Xi’s reform team has yet to end. Some economists believe that the fallout has hampered Asia’s largest economy, which has since been deflating this year, and that it is at risk of repeating Japan’s mistakes from the 1990s.

The most obvious lesson is not to focus more on short-term stimulus than structural improvements that improve competition, boost competition, and lower the risk of boom-bust cycles.

The 2015 episode saw something of a whole-of-government response to plunging shares. China Inc. at the time launched waves of state funds into the market, halted trading in thousands of businesses, discontinued all initial public offerings, and made it possible for mainlanders to pledge homes as collateral on margin loans. It even rushed out buzzy marketing campaigns to encourage stock-buying as a form of&nbsp, patriotism.

Although the response did work for some time, it was in opposition to Xi’s pledge to allow market forces to influence economic and financial policy decisions.

Since then, this treating-symptoms-over-reforms pattern has played out too many times for comfort. All of which explains why investors are concerned that using state-friendly funds to buy stocks and save money could actually go wrong.

In consequence, it is possible to make valid arguments that too frequently initiatives to promote the private sector, improve transparency, or improve corporate governance have failed to achieve the same results.

Only time will tell if Xi’s most recent actions in support of falling stock prices could also thaw out the reform process. However, Xi’s Communist Party ca n’t afford to fail in this most recent bull run for Chinese shares.

Lu’s case at Nomura is that nearly four years of turmoil in the property sector, made worse by Covid-19 lockdowns, has exacerbated troubles with rising local government debt. These pre-existing issues led to trade disputes between the US and Europe, and a flaming Middle East.

” While investors might still be OK to indulge in the boom for now, a more sober assessment is required”, Lu says.

What’s needed, say economists like Michael Pettis, senior fellow at Carnegie China, is “rebalancing” efforts that mark a decisive” shift in the economic model” to “reverse decades of explicit and implicit transfers in which households have subsidized investment and production”. And as Pettis views it, Xi’s latest fiscal effort “is n’t really part of a real structural rebalancing”.

The problem, Pettis adds, is that if China does n’t upend its growth model, “imbalances will continue to build”, meaning the nation “risks facing the same problem in the future as it does now, only without a clean central-government balance sheet to help it manage potential disruptions”.

It’s possible to end this cycle decisively. Particularly in view of the party’s most recent policy conclaves, including July’s closely watched” Third Plenum”. Xi and Premier Li Qiang showed once more that they fully comprehend what must be done to boost China’s economy, increase competition, and boost productivity.

Among the signals that were music to investors ‘ ears were pledges to: “unswervingly encourage” the private sector, pivot to “high-quality development“, accelerate” Chinese-style modernization”, champion “innovative vitality”, and “actively expand domestic demand”.

It’s no small thing that the Plenum communique” for the first time mentions carbon reduction,” says Belinda Schäpe, China policy analyst at the Center for Research on Energy and Clean Air. This elevates China’s commitment to reducing emissions and tackling climate change&nbsp, to a new level”.

Missing, though, has been urgent implementation since. That includes rebalancing the growth engines, reducing the influence of ineffective state-owned enterprises that still control the economy and financial imbalances caused by falling real estate values to struggling municipalities struggling with mounting debts.

To grease the skids for these and other disruptive reforms, says economist Brad&nbsp, Setser, senior fellow at the Council on Foreign Relations, Beijing must overcome its aversion to fiscal pump-priming.

” The needed reforms to China’s central government center around freeing itself from the set of largely self-imposed constraints”, Setser says. ” Such constraints have limited its ability to use its considerable fiscal space to help China sort out its current bind: a shrinking property sector and falling household confidence.”

According to Setser,” the central government has ample room to ensure that the property developers deliver on pre-sales– or provide a refund… and to expand the provision of social insurance while lowering regressive taxes.” Even if that results in a larger central government deficit, the central government still has the ability to change the revenue-sharing formulas to support the troubled provincial governments.

Setser goes on to say that if China’s central government had fiscal space and used it to give households more freedom to spend money, it might be able to recover from the country’s property slump on its own, without relying even more on exports.

A significant policy push also needs to include efforts to create bigger, more dynamic social safety nets to encourage households to spend less and save more.

Xi has repeatedly demonstrated that he is aware of how to create a more creative, productive, and market-friendly China. His team simply needs to act or risk paying the price for yet another deceitful global investor.

Follow William Pesek on X at @WilliamPesek

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China likely to launch military drills around Taiwan after president’s national speech, sources say

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According to Chinese officials, China is likely to conduct military exercises this month near Taiwan, using Taiwan President Lai Ching-te’s approaching National Day conversation as a pretext to stress the island into accepting its claims for sovereignty. China conducted “punishment” drills in Taiwan immediately after Lai’s inauguration, which Beijing describedContinue Reading

House to reaffirm majority vote policy on Wednesday

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Chartreuse election “on trail” for February 2

PUBLISHED: 5 Oct 2024 at 06: 05

MPs attend a House meeting on Sept 12. The House will convene on Wednesday to reaffirm its decision that a charter amendment referendum will be decided by a majority vote, says Nikorn Chamnong, secretary of the ad hoc House panel on the referendum bill. (Photo: Chanat Katanyu)
Members show up at a House session on September 12. According to Nikorn Chamnong, director of the ad hoc House section on the election act, the House will join on Wednesday to reiterate its selection that a majority vote will be used to decide the outcome. ( Photo: Chanat Katanyu )

On Wednesday, the House will organize to reiterate its determination that a majority vote will be used to decide a contract amendment referendum.

MPs will unwaveringly support their claim that a simple majority vote is enough to move charter amendments, according to Nikorn Chamnong, the head of the ad-hoc House panel on the referendum bill.

Following the Senate’s earlier this week’s decision to keep two requirements for the adoption of a contract referendum: a minimal voter turnout and majority support, the meeting took place. This implies that the majority of voters must support the election and that more than 50 % of citizens must do so.

On Wednesday, Mr. Nikorn announced that the House would select 10 people to serve on a shared House-Senate council, while the Senate is scheduled to appoint 10 people to the council on October 15.

The committee will hold a meeting on October 16 through October 23 to discuss the proposed legislation and determine the required length of the bulk needed to pass a referendum on the 2017 constitution.

The costs will be forwarded to the excellent minister for distribution for royal assent if an agreement is reached by Oct. 28 and both chambers agree by that date.

The first round of the charter act referendum is likely to go as planned on February 2nd, 2014, when municipal administrative organizations are elected nationwide, according to Mr. Nikorn, if things go according to this timeline.

The Senate’s choice to keep the two conditions is expected to put off a vote on the contract update.

Mr. Nikorn expressed his hope that the House and the Senate does come to an agreement to speed up the process of enacting the contract amendments.

This is because the law act plan requires one-third of help, or 72 votes, from the Upper House, he said, adding that a discussion on the vote bill may help reduce delays or complications.

When asked about Bhumjaithai chief Anutin Charnvirakul’s assertions this week that it was more urgent than revising the contract, Mr. Nikorn responded that while it is not urgent, there is also no justification for putting it off.

The Chartthaipattana Party, according to Mr. Nikorn, is in favor of a charter update, which is a partnership policy, as well as the creation of a charter draft assembly to create a new contract to make it more equitable and widely accepted.

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Don’t forget Japan’s Gamblers, Fraudsters, Dreamers & Spies – Asia Times

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What if the rise of modern Japan was n’t shaped just by its politicians, academics, and company leaders but also by a motley crew of players, thieves, dreamers, and scouts? What if the people who had the biggest influence on Japan’s post-war conversion were n’t the historical figures but the strangers who lived in the dark?

Robert Whiting ‘s&nbsp, Gamblers, Fraudsters, Dreamers &amp, Spies: The Outsiders Who Shaped Modern Japan&nbsp, takes you on a journey into the lives of these very characters – risk-takers and rule-breakers who, through their daring and often illegal techniques, changed the face of the nation forever. &nbsp,

Whiting’s earlier works for as&nbsp, Tokyo Underworld&nbsp, and&nbsp, You Gotta Have Wa have explored both the legal underbelly and Japan’s love for baseball and in his latest work, Whiting brings us into the dark, complex world of people who never quite fit into Japan’s firm society but also managed to leave their mark. It navigates through a tricksters ‘ exhibition of personalities who defied convention and altered the course of the nation.

The authors ‘ characters range from post-war gang leaders and foreign spies to hustlers and intellectuals who saw Japan as a land of opportunity. Whiting skillfully uncovers the relationships between them, demonstrating how frequently their actions impacted the development of history in unintended methods.

Although Yoshio Kodama is not the main character in the book, I have a story about her, and I’ve also written about her in an article called” Who is Yoshio Kodama” ( ). –&nbsp, is often entertaining. Whiting wrote about Kodama in&nbsp, Tokyo Underworld&nbsp, but he pops up again in this guide.

Kodama’s history reads like a drama, blending high-level social influence, strong ties to organized crime, and secret involvement with the CIA. Kodama was a plumber, a nationalist, and a gentleman who understood the power of working in the darkness, which is the kind of personality Whiting excels at monitoring.

And, believe me, there are so many excellent reports in&nbsp, Gamblers, Fraudsters, Dreamers &amp, Spies: The Strangers Who Shaped Modern Japan&nbsp, that you’ll come back to it over and over again to learn. What I really like about Whiting’s new text is that you can learn the pages at any time you want and return and read it over and over again.

Amazon.com: Gamblers, Fraudsters, Dreamers & Spies: The Outsiders Who ...

Kodama’s lifestyle, like many of the different characters in this book, completely encapsulates the book’s key theme: Often, it’s not the constitutional or spiritual figures who shape a nation, but the outsiders willing to take risks and bend the rules to succeed. &nbsp,

Whiting has a real gift for turning history into an engaging narrative. This book is both thrilling and informative thanks to his thorough research and a storytelling that almost seems to be cinematic. The gamblers and fraudsters he writes about were n’t just criminals; they were visionaries who saw Japan as a land of opportunities, frequently daring to make moves that the conventional power structures could n’t possibly imagine.

In the same way, the spies and dreamers he encounters saw Japan as a crucial battleground during the Cold War, and their covert actions affected both Japanese and international policy. I was surprised to also read about a CIA agent who has the same last name as mine and I wrote about it on my&nbsp, substack, &nbsp, too.

Charles Kades, a stellar GHQ figure, with his mistress, Viscountess Tsuruyo Torio. ( Robert Whiting Substack ).

In&nbsp, Gamblers, Fraudsters, Dreamers &amp, Spies, Whiting also shows that it was n’t always men who played dubious roles in shaping post-war Japan.

Figures with significant political influence included Viscountess Tsuruyo Torio, who had a scandalous relationship with Colonel Charles Kades, a senior US Occupation force in Japan after World War II, and had a scandalous relationship with him.

She proves that women, too, could wield power and stir controversy behind the scenes.

Kades, a Harvard-educated lawyer, played a crucial role in drafting Japan’s post-war constitution. Despite being married, he openly visited Viscountess Torio, with her husband’s knowledge and approval.

The Viscount even seemed proud of their union, hosting Kades while still maintaining his own extramarital affairs, which led to a notable scandal.

The Moonies story is by far my absolute favorite book chapter. The CIA was a crucial component of the establishment of the Korean Central Intelligence Agency (KCIA ) in 1961, which was modeled after the CIA itself, in an effort to contain communism in East Asia after the Korean War. The KCIA’s goal was to safeguard South Korea from communist influence, particularly from the North, while also serving as a tool for US geopolitical goals in the area.

Sun Myung Moon’s Unification Church, a religious organization with vehement anti-communist ideology, quickly became associated with the KCIA. Brigadier General Kim Jhong-pil, the KCIA’s founder, embedded several agents within the church, recognizing its utility in combating communism. &nbsp,

Rev. Sun Myung Moon, founder of Unification Church, dead at 92 | CTV News
Rev. Sun Myung Moon, founder of Unification Church.

With CIA backing, the Unification Church expanded rapidly, aligning with pro-American political forces in both South Korea and Japan. The Unification Church’s influence spread internationally, particularly in the US, where it was involved in various political campaigns, and the CIA provided initial seed money and contacts to Moon’s ventures in the United States.

Moon’s organization was seen as a tool for shaping US foreign policy, and its support for right-wing politicians strengthened its ties to intelligence agencies. The church’s anti-communist stance and the covert support of the CIA and KCIA helped it develop into a political force, using funds raised abroad, but primarily from Japan, to further its goals.

Whiting brilliantly weaves the complex relationship between the Moonies and Japan’s political elite, particularly with his grandson Shinzo Abe and former prime minister Nobusuke Kishi.

The church gained influence within Japan’s ruling Liberal Democratic Party ( LDP ), growing in popularity with the KCIA and receiving financial support from powerful Japanese ultranationalists like Kodama. Kishi’s ties to the church allowed the LDP to benefit from donations, free labor and political support.

Abe continued to have close ties to the church as a result of decades of this alliance. Abe even congratulated Unification Church members as late as 2021, extending the family’s relationship with the organization. In the end, his 2022 assassination resulted from the connection.

The assassin blamed the church for his family’s financial ruin ( his mother had donated vast sums to the church, driving the family into bankruptcy ) and this personal connection, combined with the church’s broader controversial practices in Japan, motivated the assassin to target Abe, believing that Abe’s political support for the church was responsible for his family’s downfall​.

Shinzo Abe: How the former Japan PM's assassination unfolded - BBC News
Tetsuya Yamagami, former prime minister Shinzo Abe, was shot shortly after the incident.

For someone like me, who has long been fascinated by the intersection of politics, power, and morality, this book is an absolute gem. My own interest in Japan’s hidden influencers is deeply influenced by Whiting’s investigation into the lives of the characters. It’s these untold stories, of people who live on the margins but exert enormous influence, that truly shape a country’s identity.

Whiting captures this theme brilliantly, drawing the reader into a world where the stakes are high, the moves are bold, and the consequences are often game-changing. The book does n’t glorify these figures, but does argue that their roles were essential to Japan’s development, shedding light on a darker side of history that is often overlooked.

In&nbsp, Gamblers, Fraudsters, Dreamers &amp, Spies: The Outsiders Who Shaped Modern Japan, &nbsp, Whiting presents a variety of compelling stories from Japan’s postwar underworld. For me, three of the most fascinating things are:

    The Allies and the Soviet Union battled for influence in Japan after World War II. Whiting delves into the Canon Agency, a black-ops spy network created by US Army Major Jack Canon. A formidable Texan with a background in explosives, Canon was given the task of conducting covert operations to expel communist sympathizers and Soviet spies. His agency was involved in sabotage, drug smuggling, and even kidnapping double agents like Wataru Kaji, all in the name of keeping Japan under American influence. Canon recruited a diverse group of Euro-American, Nisei ( second-generation Japanese-American ), and Korean-American agents, setting new standards for postwar covert operations. [ Whitting’s writings on the Canon agency have been published or republished by Asia Times. ]

  1. The Girard Incident: &nbsp, Whiting details the killing of 46-year-old Japanese woman Naka Sakai by United States Army soldier William S. Girard in Soma, Gunma Prefecture, on January 30, 1957. When Girard shot an empty grenade cartridge at her, apparently for his own amusement, Saki, a housewife who was collecting shell casings from a military base to sell for scrap, was killed. The incident led to disputes between Japan and the U.S. Army over jurisdiction, which resulted in Wilson v. Girard, a US Supreme Court case. The US Army demoted Girard, and the incident resulted in a reduction in US troops stationed in Japan. Girard also received a three-year suspended sentence from Japanese authorities.
  2. The Korean Taxi Barons: Whiting profiles the rise of the Aoki family, ethnic Koreans who overcame discrimination to build MK Taxi, one of Japan’s largest taxi firms. Sadao Aoki, the family patriarch, battled both Japanese taxi competitors and government regulators, who were reluctant to see an ethnic Korean succeed. His son Masaaki Aoki, despite facing racism in both Japan and the US, eventually took over the business, leading it to new heights, including introducing revolutionary practices like late-night taxi services. A cliffhanging book can be written about Masaaki’s demise.

Gamblers, Fraudsters, Dreamers &amp, Spies&nbsp, is a must-read for anyone intrigued by Japan’s modern history, especially those curious about the unsung individuals who played critical roles in its rise as a global power. Whiting invites us to consider a more nuanced and complex version of history, where the influence of outsiders and misfits is equal to, if not more, that of the famous figures we read about in books.

You wo n’t be disappointed by the tales of ambition, risk, and rebellion that shaped the Japan we know today.

( A footnote: Whiting was incredible in my documentary film&nbsp, The Ones Left Behind: The Plight of Single Mothers in Japan ��

Rionne’s Writings

Rionne” Fujiwara” McAvoy is a Tokyo-based Australian professional wrestler and filmmaker whose documentary” The Ones Left Behind: The Plight of Single Mothers in Japan” recently began showing in K’s Theaters in Tokyo’s Shinjuku. This article, originally published on his Substack, is republished with permission.

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As communist China turns 75 can Xi fix its economy?

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Getty Images People walk past a giant screen outside a shopping mall which displays a sign marking the 75th anniversary of the founding of the People's Republic of China, on the third day of a week-long National Day holidays in Beijing on 3 October, 2024.Getty Images

The ruling Communist Party unveiled a number of methods to boost China’s struggling economy as it prepared to observe its Golden Week trip and commemorate its 75th anniversary.

The plans included support for the country’s crisis-hit home business, support for the investment industry, money handouts for the weak and more government spending.

Following the announcements, stocks in mainland China and Hong Kong experienced report benefits.

However, economists caution that the policies may not be sufficient to solve China’s financial difficulties.

Some of the new measures announced by the People’s Bank of China ( PBOC ) on 24 September took direct aim at the country’s beaten-down stock market.

The new tools included funding worth 800bn yuan ($ 114bn, £85.6bn ) that can be borrowed by insurers, brokers and asset managers to buy shares.

Pan Gongsheng, the governor, added that the central banks had assistance listed companies that wanted to buy back their own shares. He also announced plans to lower borrowing costs and allow banks to increase their financing.

Only two days after the PBOC’s news, Xi Jinping chaired a shock economy-focused conference of the country’s best officials, known as the Politburo.

Authorities made the promise to increase government spending to help the economy.

The standard Shanghai Composite Index rose by more than 8 % on Monday, the day before China began its weeklong vacation, making it its best day since the global financial crisis of 2008, when it reached its peak. The action marked the end of a 20 % increase over the course of the previous five days of protest.

The Hang Seng in Hong Kong increased by over 6 % the day after businesses closed on the island.

” Buyers loved the presentations”, China researcher, Bill Bishop said.

Mr. Xi has more pressing problems to address than just popping vodka lids, which investors may have had.

Getty Images China's President Xi Jinping speaks during a National Day reception on the eve of the 75th anniversary of the People's Republic of China.Getty Images

With the 75th anniversary of the Soviet Union’s establishment, The People’s Republic has been in existence for 74 years. Only the other big socialist sate, the Soviet Union, has since fallen.

The officials of China’s leaders have long been concerned about avoiding the death of the Soviet Union, according to Alfred Wu, an associate professor at the Lee Kuan Yew School of Public Policy in Singapore.

At the forefront of officials’ minds will be boosting confidence in the broader economy amid growing concerns that it may miss its own 5% annual growth target.

” In China goals must be met, by any means necessary”, said Yuen Yuen Ang, professor of political economy at Johns Hopkins University.

The management problems that failing to meet them in 2024 may cause a slow-growth and low-confidence loop.

The decline in the nation’s property market, which started three years ago, has been one of the major drags on the second-largest economy in the world.

The lately unveiled stimulus package targeted the real estate sector in addition to laws designed to boost companies.

It includes steps to boost bank financing, lower loan rates, and lower the minimum down payment requirements for first-time home buyers.

However, some people question whether these actions will be sufficient to stabilize the housing industry.

” Those procedures are delightful but unlikely to move the needle many in isolation”, said Harry Murphy Cruise, an analyst at Moody’s Analytics.

” China’s weakness stems from a crisis of confidence, not one of credit, firms and families do n’t want to borrow, regardless of how cheap it is to do so”.

Leaders pledged to use state funds to increase economic growth at the Politburo program and go beyond the interest rate reductions.

However, the officials provided much information about the size and scope of government spending aside from establishing priorities like stabilizing the housing market, encouraging usage, and boosting employment.

” If the fiscal signal fall short of market expectations, owners could be disappointed”, warned Qian Wang, chief economist for the Asia Pacific region at Vanguard.

” In contrast, cyclical plan signal does not correct the structural issues”, Ms Wang noted, hinting that without deeper changes the difficulties China’s economy experience will not go away.

Economics believe that the real estate market’s deepening issues are essential to rebalancing the business as a whole.

The most expensive expenditure is in real estate, and falling home prices have contributed to consumer confidence being sluggish.

” Ensuring the distribution of pre-sold but empty houses had been key”, said a word from Sophie Altermatt, an analyst with Julius Baer.

Governmental assistance for household incomes must move beyond one-off transfers and be provided by improved pension and social protection systems in order to boost domestic consumption on a green basis.

Getty Images Unfinished project of Evergrande Cultural Tourism City in Zhenjiang City, China.Getty Images

On the day of the 75th celebration, an editor in the state-controlled paper, People’s Daily, struck an cheerful voice, recognising that “while the journey back remains challenging, the potential is promising”.

According to the article, concepts created by President Xi such as “high-quality development” and “new productive forces” are key to unlocking that path to a better future.

The emphasis on those concepts is a result of Xi’s desire to shift from the traditional fast growth drivers, such as investment in property and infrastructure, to create a more balanced economy based on high-end industries.

The challenge China faces, according to Ms Ang, is that the “old and the new economies are deeply intertwined, if the old economy falters too quickly, it will inevitably hinder the rise of the new”.

The leadership has come to terms with this and is taking action accordingly.

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Daniel Ricciardo: How shy Aussie kid became F1 golden boy

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Facebook A young Daniel RicciardoFacebook

The American Grand Prix in 2006 featured everyone from the artist Amanda Bynes to the Dutch Prime Minister, a 70s music star, and the classic Blue Wiggle stepping pit lane, as usual.

Unnoticed in a spot, making small talk with European drivers Jarno Trulli and previous Miss Universe Jennifer Hawkins, was none other than 16-year-old Daniel Ricciardo.

The Perth son had already secured a race ticket after winning the previous year’s American go-karting champion, but things changed on that fateful day in April.

Remo Luciani, a family friend and mentor, jokes that it was Hawkins who made the joke:” He was essentially drooling.”

The quiet youth, however, had his first real flavor of the existence he was fervently pursuing while rub shoulders with Formula 1 stars and hearing the rumbling sound of their engines.

” I think he saw the photo- ‘ this is where I belong, this is what I want to perform ‘”, Luciani tells the BBC.

Fast forward a few years and he’d not only be part of that world, but” a major personality” in it.

But after 13 times in the game – with an outstanding 257 races, 32 championships, and eight wins – his F1 occupation came to an end next year, after Red Bull dropped him from its staff.

He emerges as the most eminently successful and well-known driver on the circuits and as the “golden boy” of American motorsport.

Hungry and talented

Coopers Photography Ricciardo in his #3 kart leading a race in 2004Coopers Photography

From the moment his motorsport-mad parents let him on a go-kart record as a nine-year-old, Ricciardo has been making an impression.

” There’s those who get it at that age, and those that do n’t, and he got it pretty quickly”, Tiger Kart Club stalwart John Wishart says.

Ricciardo immediately established himself as a quick but trustworthy competitor with an upbeat personality and ferocious aggressive spirit, a reputation he has cherished his entire career.

Former friend of Lewis Shugar tells the BBC,” What you see on Daniel’s Television today, he was exactly the same as a kid.”

” He was always laughing and having a good time, and if things did n’t go right for him, he still had a smile on his face”, Wishart says. ” That in itself is a unique skill”.

Talk of his claim spread to the eastern coast as he began to win races all over Western Australia.

Daniel Ricciardo A young Daniel Ricciardo with a go-kart racing trophyDaniel Ricciardo

Ricciardo immediately enlisted in Remo Racing, a self-styled growth team led by Luciani in Victoria.

” He was a very, very fast person, and he was determined. He wanted to always move faster. Luciani, a racing tale and inductee into the American Motorsport Hall of Fame, says,” I could see the appetite in him.”

Ricciardo won his first race for the group in 2005, where he later won the national go-karting tournament, and continued to compete in his native state in Formula Ford.

And with that, he was on his approach abroad – a “big walk” that Ricciardo has said” changed everything”.

Each new season brought a new challenge. In 2006 he raced in Asia, before moving to Italy the year after, finally signing to the Red Bull development initiative as a” nervous” and “immature” 18-year-old in 2008.

” Having that duty, that force, all of that, it forced me to develop up”, he told CNN Sport earlier this month.

Remo Racing Daniel Ricciardo (right) and his Remo Racing teammatesRemo Racing

In 2011 he made his long-awaited grand prix comeback at Derby, on payment to Spanish group HRT, thrilling his followers back home.

One described him as beating one-in-10-million conflict.

” To stay in an F1 vehicle is something that almost anyone will ever do, so even to have that chance is incredible,” Shugar says.

The Honey Badger

Ricciardo, however, was not happy with just any location on the network, and by 2014, he had earned a contact up to the main Red Bull team in place of Mark Webber, his countryman’s compatriot.

” I’m ready”, Ricciardo declared at the time:” I’m not here to run around in 10th place”.

He lived up to his word and won three races that time, far exceeding Sebastian Vettel’s colleague and defending hero.

He became known as the” Honey Badger” after four years at Red Bull, despite his charming demeanor and deadly race intuition.

His” those fantastic late-braking maneuvers that may find individuals by surprise” were his brand, American F1 blogger Michael Lamonato told the BBC.

He’s always said he wanted a popularity that made him feared when other drivers saw him in their reflections, and I believe he actually did that.

His off-the-wall reputation was also rising, even before the popular Netflix series Drive to Survive elevated F1 to new heights of admiration.

According to Lamonato,” Daniel was one of the heroes that was beginning to overcome the sport.”

His signature shoey celebration – which is credited with popularising the practice in Australia – memeable media sound bites and humorous stunts have enamoured him to legions the world over.

Issy Futcher, a fan of Melbournian, says,” He seems like a partner, someone you could make friends with at the pub.”

” He’s made for this kind of stardom”.

Getty Images Daniel Ricciardo does a swan dive into a pool after his 2018 win in MonacoGetty Images

Two times after a botched trap stop at the same circuit saw his job at its zenith when he defended his prospect for 50 rounds in Monaco in 2018 while battling a failing website.

” This was a redemption race … it really is his defining win”, Lamonato says.

However, he was left struggling in 2023 and returned to the broader Red Bull slide as a supply drivers following his disastrous goes to Renault in 2019 and McLaren in 2021, where he struggled to recreate his past success.

He rejoined the young starting lineup in its now-named RB group way through the season, but his form never recovered after being severely injured in 2024.

Rumors started to spread, and the reading was clearly on the wall when the Singapore Grand Prix arrived on September 22. In one final gasp, Ricciardo was given a brand-new set of tires and the fastest lap of the competition.

After finishing next, the 35-year-old lingered in the aircraft for a hit.

In a sad post-race meeting, Ricciardo said he was battling a lot of thoughts.

” I’m conscious it could be it”, he said. ” I just wanted to taste the time”.

He told Sky Sports that he was “at peacefulness” with his impending fate and that he just wanted to return to the network if he could earn podiums.

Getty Images Daniel Ricciardo at the Singapore Grand PrixGetty Images

Days later, Red Bull confirmed he would be replaced for the rest of the season by young Kiwi Liam Lawson – news that stirred outrage and cries of mistreatment.

Group director Christian Horner said Ricciardo’s stats and accolades were n’t the only measure of his accomplishment.

” From the moment you arrived at Red Bull, it became clear that you were much more than just a vehicle.” Your regular joy, sense of humour and approach will leave an unforgettable legacy”, he said.

Amid a wave of tributes from his contemporaries, Ricciardo said it had been a “wild and great” trip.

” I’ve loved this sport my whole life … It’ll always have its highs and lows, but it’s been fun and truth be told I would n’t change it”, he wrote on Instagram.

” Until the next experience”.

Reputation secured

Getty Images Daniel Ricciardo celebrates as Mark Webber does a shoey.Getty Images

While the details of that subsequent trip are eagerly awaited, Lamonato claims Ricciardo has already established himself as one of the most underappreciated F1 drivers.

” Daniel Ricciardo has enormous potential, but he suffered what so many do, career bad turns,” is the best way to sum up.

Just nine drivers have started more races in his long career, and his victories and podiums both rank him among the top 40 drivers ever, which is particularly amazing considering that all of these feats were accomplished without the dominant team of the time.

And his reputation is now felt in Australia, where driving experts claim he has sparked the rise in grassroots racing participation and the emergence of the next generation of Asian sporting stars like Oscar Piastri and Jack Doohan.

Statistically, Ricciardo will be the fourth most successful Australian to have raced F1, but many think he’ll be remembered as the greatest.

Lamonato claims that” I do n’t think anyone will have had an impact similar to him in terms of bringing the sport to the audience.”

” ] He] did Australia proud”, Luciani concludes.

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Chiang Mai set to see more floods

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After constant storms, Ping River once more at critical stage

PUBLISHED: 3 Oct 2024 at 19: 43

The water level in the Ping River reached the critical level of 4.20 metres at the Nawarat Bridge monitoring station in Chiang Mai on Thursday evening. (Photo: Public Relations Office Region 3, Chiang Mai)
At the surveillance facility for the Nawarat Bridge in Chiang Mai on Thursday night, the water levels in the Ping River reached a critical stage of 4.20 meters. ( Photo: Public Relations Office Region 3, Chiang Mai )

After on Friday, further storms are anticipated in Chiang Mai, with water levels along the Ping River expected to start at 4.95 meters.

Governor Nirat Pongsitthithaworn stated on Thursday that new heavy downpours in inland places have caused the Ping River to rise quickly.

He advised riverside citizens to relocate their goods and vehicles to higher ground. In case an evacuation is required, facilities and neighborhood centers in low-lying areas have been instructed to relocate ill patients to safer locations.

All organizations are instructed to use obstacles and sandbags to protect flood-prone areas and to offer support to those in need.

According to Mr. Nirat, engineers from the Chiang Mai town are keeping an eye on the river conditions and are prepared to close any gaps in storm walls. &nbsp,

After heavy rain fell at 3am on Thursday, a flash flood was reported in the northern province’s Mae Rim city. In the Rim Nua sub-district, the flood damaged a number of homes and villas.

According to the nearby Royal Irrigation Department company, the Ping River’s depth at the Nawarat Bridge in Muang area reached a critical level of 4.20 meters at 4 p.m. on Thursday. That was a noticeable increase from 3.45 yards on Monday.

The valley was expected to crest at 4.95 feet at 2am Friday night.

Following a storm that started on Wednesday morning, the Mae Sai River overflowed in Chiang Rai near the second Thai-Myanmar Friendship Bridge in the Mae Sai area at 9am on Thursday.

National Highway 118 and some locations in Chiang Rai’s Wieang Pa Pao city were likewise flooded, according to local officials.

Governor Chucheep Pongchai in Mae Hong Son gave orders to examine the situations in flooded areas, including the Long-Necked Karen area in the Muang district’s tambon Ha Bong.

In Loei, heavy storms caused flash flooding in many domestic and farming places in Ban Nam Chan and Ban Kaeng Hin communities in Wang Saphung area.

The north, northeast, central, and eastern parts were expected to start easing on Friday as a cool before from China goes over the lower regions of Thailand, according to the Meteorological Department.

Due to the weakening influence of the cool top over the area, the eastern region of the North should anticipate more heavy downpours until Oct. 12.

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Yen at 125 less black swan than gray under Ishiba – Asia Times

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Tokyo: With the yen looking set to skyrocket, the” Ishiba shock” ruining stock investors ‘ week may only just be beginning.

The research here, of course, is to the surprise poll of Shigeru Ishiba as Japan’s probable next prime minister. The veteran lawmaker, a self-described “lone wolf”, seemed to come out of nothing last week to best eight different candidates for the ruling Liberal Democratic Party’s management.

However, the real wonder may be how Ishiba’s long-held beliefs set the stage for an amazing yen protest.

For now, Ishiba, 67, is downplaying his taste for Bank of Japan price hikes and a stronger renminbi. As investors speculate that Ishiba might not be the feared financial hawk, the yen is falling this week. They’re good bad.

Obviously, Ishiba’s officials warned him that perhaps BOJ Governor Kazuo Ueda is bashful about more strengthening. Chances are, too, Ishiba’s inner circle is looking at slowing monetary conditions&nbsp, — and China’s brake — and realizing today might not be the day for more increases in borrowing costs.

However, Ishiba’s preferences for higher prices and a rising japanese are unlikely to hold back for very long. Since&nbsp, July 31, when the BOJ hiked short-term costs to their highest level since 2008, the renminbi has given up its sharp 2024 costs. In late June, it passed the 161 to the US level, the lowest in more than 37 times.

Since then, the dollar has rallied more than 9 %, dealing on October 3 at around 147 to the greenback. And as Ishiba transitions to the position of prime minister, there are good chances that the yen protest will push into even higher products. Could it go to 125 or higher? So do the problems about an” Ishiba shock” soon developing.

Second, Ishiba’s LDP may succeed at the September 27 snap election, the chances of which are good given the persistent turmoil among opposition events. BOJ representatives are likely to believe that Ishiba has their tails when he settles in and attempts to implement zero rates.

It’s Ishiba’s long-held conviction that the ultra-weak japanese is doing more harm than good. He told Reuters as late as August that” the Bank of Japan is on the right plan path to eventually coincide with a world with good interest rates.”

Ishiba continued,” We must realize the positive aspects of price increases, such as a property market rout, have been the focus right now, but we must understand their merits as higher interest rates may lower the costs of imports and create industry more competitive.”

The BOJ’s decision to raise prices to 0.2 % resulted in the Nikkei 225 Stock Average’s worst decline since October 1987, among other “aspects.” On Monday only, the Nikkei fell 5 % as investors assessed Ishiba’s expected economic policy mixture.

Yet it’s difficult to reject the reasoning underlying Ishiba’s take these. The argument is that 25 years of relentless exchange-rate exploitation have had a backseat, which some LDP heavyweights will acknowledge. Ishiba outshined by his surprise victory to gain the LDP election.

Sanae Takaichi, a senator, is one of them, who believes she is the natural heir to Shinzo Abe’s reflationary signal measures.

Takaichi stated on September 19 that” I think it would be terrible to raise interest rates right today.” She added that “what we’re seeing today is cost-push inflation. We must maintain economic plan until real income consistently rise.

The Ishiba believes that a quarter century of free money has stifled the need for the government to revamp labor markets, cut red tape, support a business growth, empower women, and stop the shift of economic power from Tokyo to Shanghai.

It also reduced stress on corporate CEOs to rebuild, develop and get great threats on new products, solutions and industries. It helps explain why Japan is 30th in productivity among the 38 members of the Organization for Economic Cooperation and Development ( OECD ).

Beginning in 2013, the BOJ supersized quantitative easing. By 2018, the BOJ’s balance plate had surpassed the size of Japan’s US$ 4.7 trillion in annual production due to the amount of government bonds and stocks it hoarded. The BOJ had to get an leave because of that purchasing spree, which has now fallen to Ueda.

The aggressive global market response to the BOJ’s&nbsp, July 31&nbsp, tightening has left Team Ueda gun-shy about further movements. However, the need to tighten monetary policy perhaps simply grow as inflation rises.

The problem, says Takeshi Yamaguchi, analyst at Morgan Stanley MUFG, is an “increasingly extreme scarcity at smaller non-manufacturers” that’s driving “further worsening in the work situation overall”.

The biggest give boost for workers in 33 years was scored by Japanese organisations earlier this year. It’s piece of Tokyo’s work over the last few years to generate a “virtuous cycle” of salary increases. The goal is to improve corporate profits to levels that encourage also fatter pay raises, which will in turn boost consumption and GDP.

However, if these increases are not followed by steps to improve overall output, they could lead to inflation. In August, Japan’s” core” consumer price index rose at a 2.8 % year-on-year rate, well above Tokyo’s 2 % target. It marked the third straight month of motion.

” Consequently, underlying inflation may … fast another rate climb by the Bank of Japan at its October meeting”, says Marcel Thieliant, Asia-Pacific scholar at Capital Economics.

Ishiba might provide the walk with the necessary political support. Ishiba’s main objection to the poor japanese is because he thinks it’s causing him to believe that both at home and abroad. It lowers families ‘ purchasing power, making Japan prone to imported inflation caused by higher commodity prices.

Some foreign investors, however, are confounded by a very developed market maintaining a developing-nation-like exchange-rate plan. Why does investors believe that the” Japan is up” tale is true this time if Japan Inc. is not ready to grow without history’s largest corporate welfare scheme?

Some economists predict that Ishiba may back off and force the political dynasty to pressure the BOJ to raise the yen. If thus, the Fumio Kishida government’s plans will continue to exist.

According to Masafumi Yamamoto, a strategist at Mizuho Securities, Ishiba’s” attitude on financial plan is thought to be the same as the Kishida administration, which usually respects the independence of the BOJ, and he is not constantly in favor of raising interest rates.” Therefore, it is likely that the opportunities for the yen to continue to rise are limited in the run-up to the new cabinet’s formation.

We think the most recent political developments in Japan still support a more gradual than accelerated JPY appreciation path, as suggested by UBS analysts in a note.

Strategist Yukio Ishizuki from Daiwa Securities acknowledges that” Ishiba’s comments over the weekend were trying to put out the fire of his hawkish image.”

Since then, says strategist&nbsp, Jeff Weniger at&nbsp, Wisdom Tree&nbsp, Asset Management,” things have settled down. Investors have come to the realization that even if the Fed Funds Rate wins the job, there will still be a yawning gap between the two nations ‘ cost of money.

The outlook of the US Federal Reserve is in fact a wildcard. ” The lack of clarity on how the easing cycle will unfold and the inverted yield curves”, are key challenges facing global markets, says&nbsp, Teresa Ho, a strategist at&nbsp, JPMorgan Chase &amp, Co.

This might explain why so many currency traders insist that the yen wo n’t deviate too far from the current levels. Hedge funds and other speculative entities have more than 66, 000 positions positioned on a rising yen, according to data from the US Commodity Futures Trading Commission ( CFTC ). That’s the most since October 2016.

The size of this position is largely due to the so-called “yen-carry trade,” which has resulted in Japan becoming the world’s top creditor nation by keeping rates at or close to zero since 1999.

Borrowing cheaply in&nbsp, yen &nbsp, and deploying those funds in higher-yielding assets around the globe became the most popular maneuver in finance. Bloomberg data puts the scale of the trade at about$ 4.4 trillion, a sum larger than India’s economy and roughly twice the size of Russia’s.

The global financial system would tremble and quake if the yen-carry trade sprang into chaos. However, a yen move toward 125 to the dollar would be less of a black swan than a gray one with Ishiba as the head of the market.

Follow William Pesek on X at @WilliamPesek

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