2020 Tokyo Olympics - Bubble, Boom, Bust (Out of Control Gov't Spending & Tax Increases...) Oh, and Don't Mention Fukushima!

“The price of anything is the amount of life you exchange for it.” ~ Henry David Thoreau

Before I go on, let's do some chemistry (oh, I wish!) First off, the elements. I'd like to point out to you, the newest discovery in the elements and that is Governmentium. It is the heaviest of all elements, yet it does absolutely nothing good. It just expands. See the red box at the lower left:

Governmentium: Inert, worthless.

The Urban Dictionary says:

The heaviest chemical element yet known to science. Governmentium (Gv) has 1 neutron, 12 assistant neutrons, 75 deputy neutrons, and 224 assistant deputy neutrons, giving it an atomic mass of 312. These 312 particles are held together by forces called morons, which are surrounded by vast quantities of lepton-like particles called peons. Since Governmentium has no electrons, it is inert. However, it can be detected as it impedes every reaction with which it comes into contact. 

....Governmentium mass will actually increase over time, since each reorganization will cause some morons to become neutrons, forming isodopes. When catalyzed with money, Governmentium becomes Administratium--an element which radiates just as much energy as Governmentium since it has half as many peons but twice as many morons.

Keep that information about Governmentium in mind while you read today's post.

In my last few postings, I complained about the 2020 Olympics coming to Tokyo. Actually, not exactly that; I complained about how the government will use that as an excuse for out-of-control spending and the subsequent taxation.

Well, lo and behold, not 5 days have passed and the hammer has come down. Japanese Prime Minister Shinzo Abe has pronounced that he is going ahead with the increase in sales tax. From the Japan Times "Abe to raise sales tax to 8% as scheduled - More stimulus in works but critics fear hike will hobble recovery":

"Prime Minister Shinzo Abe has decided to raise the consumption tax rate to 8 percent next April as planned, emphasizing the need to demonstrate fiscal discipline by making good on a pledge to the international community, a source close to him said Thursday." 

Oh? So finally this guy wants to show some "fiscal discipline" concerning the Japanese debt to GDP problem? Great. He also admits that a sales tax increase will most probably slow down the economy... He wants to show the critics that the tax increase will not slow down the economy, so what does he do? In true Keynesian fashion he is going to spend more money! The Japan Times article goes on with a laugher and total contradiction of the "fiscal discipline" comment Abe made (polite laughter here).

"Abe, who has been trying to shake the economy out of nearly two decades of deflation, is also considering implementing a stimulus package worth ¥5 trillion to prevent the tax hike from slowing down the economy, the source said." 

See? We have to show fiscal discipline (translation: controlling government spending) by increasing government spending. Let me rephrase that: We have to show some fiscal responsibility by spending more money!

What did I tell you? Throw that ¥5 trillion (¥5 trillion yen? Is that $50 billion USD?) on top of the ¥10 trillion (is that $100 billion?) - it will be much more, you'll see - they plan on spending on the Olympics and you have the government spending $150 billion dollars on crap. ONE HUNDRED AND FIFTY BILLION US DOLLARS!!!!

Ah, but it's just a drop in the bucket, right? The Japanese government is already at least $10.46 trillion dollars in debt - that's nearly 250% of GDP? Another $150 billion is a drop in the bucket, right?

I'll bet lots of people who were cheering the Olympics slapped themselves on the forehead when they heard the news about the tax rise. I didn't. I just thought, "See? I told you so." You just knew that the 2020 Olympics coming to Tokyo would serve, for now, merely as a green light for MORE out of control government spending.

They already said they were going to spend about $10 billion USD... Like I said, I bet you a half a bento it will be waaaaaaaay more than that!

 Tokyo’s winning 2020 Olympics bid will only worsen Japan’s debt headache:

"...The cost of Tokyo’s bid fell between $5 billion and $6 billion. That includes the construction of 11 new sporting venues and 10 temporary ones, at a cost of $3 billion. The Olympic village will cost another $1 billion, according to the IOC.

See? It works already! Like I said, the Olympics are an excuse for more out of control government spending and, with that, a cover to increase the sales tax... It's funny that when the former government who made this tax increase passed the law, Abe and his cronies were against it... Now they are for it.

Who said that these political parties weren't simply two sides of the same coin?

Abe and his cronies claim that the Olympics will charge Japan's infrastructure investment and help the economy. That's bullsh*t folks. Don't forget, that Japan ran up this 245% debt to GDP all through the 80s, 90s, 2000s with wasteful infrastructure investment. How is having an event going to change the equation?

Testosterone Pit writes in Tokyo Olympics "Boom" and "Bubble":

These words are already cropping up when discussing real estate developments in the Harumi area, reclaimed land by the Tokyo Bay where the Olympic village will be sandwiched between the two main competition sites. Two dozen high-rises are to be built (though high-rises on reclaimed land did badly during the earthquake in 2011 as the ground “liquefied”) with nearly 11,000 luxury apartments. There will be dining halls, seaside restaurants, and parks. And views of the Rainbow Bridge to Odaiba, a manmade island with hotels and apartment buildings, but not much else. 

All this activity, including new transportation, will jack up apartment prices by 20%, Sanyu Appraisal Corp. announced giddily. This bubble excitement comes on top of the bubble the BOJ’s free trillions are already creating in the Tokyo property market. It would “particularly benefit land owners” in Tokyo Waterfront City, predicted a report published by Macquarie Securities to further stir up bubble enthusiasm. Nomura Securities jumped into the fray with its own prediction that it would “attract a new wave of investors to housing in the bay area” that would “push up property prices.” Alas, if wages remain stuck where they are, and if inflation cuts real wages further, who is going to buy these beauties? The few beneficiaries of Abenomics and foreign investors? 

Yeah, let's build lots of building and sky rises... Just like the late 80s when these things were built in Makuhari. Been there recently? I went there, just last month... These beautiful office buildings and high rises still stand empty... At 50% (or less) occupancy. Huge money losers...

And most Japanese people cheer the 2020 Tokyo Olympics? Incredible. If they are happy now, then I guess they'll all be having orgasms when their sales tax goes to 10%.... Any bets for 15% (or more) by 2025?

The Abe government gets their wish: A smoke screen to cover for more spending. The people cheer on...

"Panem et circenses" (bread and circuses) - 大衆の不満をまぎらわすために提供される)食事と娯楽.　−　Juvenal

No problem about the debt, though... Our kids can pay for it.

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NOTES ON FUKUSHIMA: Never mind yesterday's news (Sept 13, 2013) that completely contradicts what Shinzo Abe said to the Olympic committee. From Japan Times:

A senior official of Tokyo Electric Power Co. admitted during a meeting with opposition lawmakers on Friday that the massive radioactive water buildup at the crippled Fukushima Daiichi nuclear power plant is "not under control." ... that view directly contradicts Prime Minister Shinzo Abe's statement last week to the International Olympic Committee in pushing Tokyo's bid to host the 2020 Summer Olympics.

I said not to mention Fukushima... Well, I lied.... Just like Shinzo Abe. And I don't really think that the radiation from the leaks are all that much of a problem, as opposed to what the media is reporting. But that's the kicker here, isn't it? The media reports one thing and the Japanese government and TEPCO say another.... Will world governments and athlete's believe their media or what the Japanese government says?

I don't think what Abe or TEPCO says have much credibility left. 

Do you?

Here's what Der Spiegal thinks in Germany: http://www.spiegel.de/international/world/inspector-says-japan-needs-international-help-for-nuclear-plant-a-921302.html

Thanks to my friend Mark Davis for the Thoreau quote.

Get All Your Money Out of Banks and Other Nutty Ideas!

Yep! This is the way it is; get all your money out of the bank. Put it in a mattress or under the flower planter. Put it anywhere but the bank! 

What's going on in Cyprus is coming to a neighborhood near you. Don't say you weren't warned! Smart folks like me (we'll if we really were smart, we'd be rich) read Zerohedge everyday and knew in 2011 that the criminals and idiots that run our government's had no way out of the current economic mess so they would, eventually, come to steal money in people's bank accounts.

That "eventually" happened about 10 days ago.

I'm hoping that dear reader has kept up on what's really going on in Cyprus and Europe so that I don't have to go too much into detail... But, just in case they are not, here goes:

Cyprus is bankrupt. To pay for the debt, they decided to steal people's money in bank accounts. They figured that the people they could screw the most were Russians who were ex-KGB and mafioso types so that the regular people, Joe-Blow types, wouldn't get too upset. They figured if they made it look like bad guys were getting screwed, and not Joe-Blow, no one would complain too much.

F*ck the rich, right?

Well, the Euro Einsteins in the (as Fred Reed would write) "Gubbmint" figured wrong as it now looks like the ex-KGB and Russian mafioso types have already snuck all their money out of Cyprus while the geniuses weren't looking. Well, hell! Of course they did! That's why they are ex-KGB and mafioso types! Do you think they became a part of the underworld because they were standing around like Joe-Doofus? Er, I mean, "Bending over and holding their ankles like Joe-Doofus?"

No way! This is the real world!

Now it is the average Joe-Blow who will, of course, get F*cked! You didn't really think ex-KGB and mafia people were going to get f*cked did you? I mean, what planet are you living on?

Anyhow, I'm drinking now so I'm on a roll....

This is how it is, folks:

1) Get your money out of the banks*

2) I don't care who your are, you're about to get f*cked (people living in Japan, please take a number!)

3) Get as much gold or silver or real estate as you can (hard to steal that sh*t!)

4) Get weapons, canned food, a damned good home alarm system, a safe and keep money and important sh*t at home.

5) Make a plan with neighbors to watch each other's houses when you, or they, are gone.

*= Get your money out of the banks? Yes, Mike (that's me) says. But! If you have zero in the bank then the feds will be suspicious, so keep a token, but substantial enough, amount in those banks not to draw attention to yourselves. Trust that if you own a million dollar home yet only have $30 dollars in the bank, the tax office will be suspicious.... Point? KEEP A "SACRIFICIAL LAMB" amount of money in the bank to divert attention from yourselves.

Dear Readers! The sh*t is hitting the fan much faster than anyone realizes (I believe). Prepare now!

The people who are running our government and (far too many of) our corporations are completely and totally incompetent! 

Here is an analogy of what is going on. I cannot state specifically the company, or government run airlines doing the following, but this is a real-life example that is going on right now and it should be raising the hair of shareholders in this company!.... This is typical, from what I've seen, how things are going... 

Make no mistake about it, this kind of incompetence and mal-investment is caused by government interference in the economy and easy-credit.

Here's the example:

There's an airlines in Japan. It has a new manager. She is totally over her head and has zero business experience. What she is doing is appalling.

Listen to this and you tell me if you think I am wrong!

On May 1st, this new airlines manager, she has decided to completely change the flight schedules for all routes on the entire airlines.

Is there any reason or scientific data to support this change? No. It is a "feeling."

Then this new manager has cut the working hours on the most popular routes, of her most experienced pilots, from 20% ~ 50%! Of course, all the experienced pilots are unhappy.

I think it is pretty much common knowledge that unhappy employees don't do good work. It gets worse... Read on!

This new manager, to complicate matters, has also completely fired all ground and support staff - who have been there for years - and replaced them all with brand new people! That's right! The entire support teams, from check-in, to luggage, to in-flight dining, to navigation and book-keeping; these have all been changed completely!

So far, so good? 

Well, I don't know... Maybe... 

Maybe these changes do make sense? Maybe these are the ideas of a dedicated and experienced professional. Maybe Richard Branson could pull this off? I'm not sure. But the person in charge has never ran an airlines before. She is guessing.

But the next change is just a jaw-dropper and makes me fear for the future of this airlines:

Not only has the new manager cut all the experienced pilot's schedules by 20% ~ 50%, and fired the complete ground and support crew staff, she has also implemented a completely new check-in, maintenance, navigation and in-flight computer system that doesn't go online until May 1st! This means that no one is able to use the new computer system until it is already online ON THE DAY THE NEW SERVICE IS UNVEILED!

There will be no training and testing of the new system!!!!

Is she completely mad? Actually, no. 

She is just over her head and incompetent. There is no excuse for such actions. She has also surrounded herself with "Yes-men."

You can bet your bottom dollar that there won't be a single flight that takes off or arrives on-time and on schedule with such a scatological management system.

Fact is that even the staff are now complaining. Fact is that even staff of this new boss are now ridiculing her to other people as being "completely incompetent."

No doubt. This is what happens when you surround yourself with "Yes men."

It's simple. You wanna change the flight schedules and experienced pilot's flight times? No problem.

Do that from May 1.

You wanna change the flight schedules, experienced pilot's flight times and complete flight support crew? Well, now you are asking a lot, but it is not impossible; maybe do that too from May 1. Or, perhaps, best to wait for six weeks? Difficult call; that's why management has to make informed and logical (and scientifically based calls).

You wanna change the flight schedules, experienced pilot's flight times and complete flight support crew as well as a totally and completely revamp the computer system (throwing away the old system) - all at the same time?!

Are you nuts?  

Your flights and customer satisfaction are dependent of flights being on time and a comfortable flight. No one cares about the computer system or ground crew you use. Changing so many things at once is just plain foolish and a sure-fire way to screw things up and...

THEN CREATE A BAD REPUTATION FOR YOURSELVES!

Not a good way to start your new service!

..........

....But that's the way it is, folks. 

And that's the kind of "leadership" and "management" we have today. It's the same in many private companies and the government. Why? Because government meddling in the economy causes for mal-investment and a distortion of true market realities and conditions.

This story about the airline is typical, my friends. I am talking about a company that I work with. It is obvious what is going to happen: Things are going to be screwed up and the other companies, whose support is critical, will lose trust.

Losing trust is the death nail; it takes a long time to build trust; it only takes one second to ruin that trust.

And now we come full circle: Japan has closed banks in the past and stolen people's money. It's happened in the USA and now Europe....

What are you going to do? Do you still trust your savings in any bank?  Do you still trust the company management and government.... With these kinds of people in charge?

Your families' health and safety are up to you and only you. You have been warned.

Need Extra Money? Great Idea for a New Business!

“We shall require a substantially new manner of thinking if mankind is to survive.” ~ Albert Einstein

GUYS! MAKE AN EXTRA $1,000 ~ $2,000 PER MONTH STAYING AT HOME!!! IT REALLY WORKS! EVERY MAN'S DREAM COME TRUE!

Japan, like everywhere else, is facing an economic slump. Most of us are doing what we can and wracking our brains to find new ways to create income.


I spoke with a good friend of mine, Mark Davis, who is a real estate consultant. Mark tells me that last year was the worst year in twenty years for his business.


I asked if this year looked the same. 


Mark replied, "...the real estate market has bottomed out and banks are making loans again. But things are still tough."


I tried to encourage him and asked if he ever considered starting a new business. 


Mark replied, "My idea for starting a new business is the wife going out and getting a job!"

I know he's happy he started a new business!

Ha! Ha! Ha! I thought that this was an excellent plan. Think of it! The ultimate get rich scheme! Sit there and do nothing and the money comes rolling in!


I love it! It's definitely a man's world! 




Thanks to Mark Davis!

Marketing Japan: Ripping People Off on Tokyo Real Estate

By Mike in Tokyo Rogers

I just found an article that shows the ultimate stupidity of some people as well as the criminal dishonesty of others... During Japan's bubble, when the Nikkei hit past ¥32,000 (today it is at ¥9,500 about) people bought all sorts of curious things as investment vehicles; they bought golf club memberships, land, stocks, condominiums, you name it.  And, while the prices were shooting up (1984 ~ 1989) they were fine.... But when the bubble burst, those people lost their shirts...

Especially the ones who speculated on Tokyo real estate.

Of course, as anyone knows, condominiums have no land with them, so, in a down market, they will lose 1/2 their value, like when buying a new car, once they are driven off the lot (in the case of a condo, once lived in)...

The real estate jerk who sold this poor woman, and people like her, condominums as "investments" do nothing but rip people off.

From the article: 

Japan women step up to make big purchases in slow economy

After 25 years working as an accounting assistant in a leading construction company, Asako Nakano decided two summers ago that she needed to stabilize her retirement plans. So she took the plunge and bought a condominium. "The decision to put almost all my savings into a home for myself was a bit daunting, but I never hesitated," said the friendly, confident single woman. "I thought to myself, I am never going to get married, so why not invest in my future? It made sense to me." With a little assistance from her mother, the 52-year-old paid almost $100,000 as a 40% down payment for her apartment in a leafy residential area of Tokyo. Japan's effort to dig itself out of its economic malaise is getting a boost from an unlikely source - the nation's female workforce. 

I like how the article spins this bad trend of dishonest sales and misrepresentation as a "part" of the so-called economic recovery that isn't happening. For more on that read my friend Mish Shedlock's blog "Global Analysis" here.

Some Real Estate Agent

What is really going on here is people are being taken advantage of by salesmen with no scruples. There's absolutely nothing wrong with buying a condominium. But being told that it is an investment for the future is just plain dishonest.

See the original article here. 

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Keywords:

Condominium, Mish Shedlock, Mike in Tokyo Rogers, Marketing Japan, Real Estate, Tokyo, Bubble, Japan, Global Analysis