Government can distort markets but not change them.

The Telegraph ran a story today talking about how all the emperor's horses and all the emperor's con men couldn't put the inflation scam back together again.  In short, so call Abenomics is failing badly.  Old Dishonest con man Abe tried to inflate the crap out of the Yen in order to manipulate it lower in order to boost exports.  His own in-country slaves, it seems, are not consuming enough and so Japan needs to run its export engine at full throttle.  I've explained many times why so called export economies don't work over the long run and worse yet while they are running they are a system of indentured servitude.

Exporting things is the act of building something with your local labor and then sending it overseas for consumption by someone else.  Someone who did not build it.  That someone might send you something of equal value in return but it doesn't really work like that in a world that is run by fake money.  In exchange for the labor of the net exporters, the net importers provide a form of colored paper called fiat currency.  What a trade!!  Such a deal!! Where can I get somadat for myself?

Back before fake money turned the world on its head, when people in a country produced something they consumed it themselves thus getting the benefit of their own labor.  But when the use of scam ridden paper money went viral, many people in the world found that if they looked across the water to their neighbors who they were exporting stuff to, those people somehow seemed to have better lives, more stuff, better food and all around better life prospects.

On the other hand, those who received the goods which they traded for their colored paper would look across the water and see poor people working in sweat shops with slavery level working conditions that are so bad that workers at high tech factories have been known on several occasions to jump to their death.  So while the aggregate importers had social safety nets, the aggregate exporters had nets of a different kind.  Yes, actual nets installed at a Foxconn hi tech factory so that the workers cannot jump to their deaths anymore.  They called them "safety nets" but in reality it was a mechanism to stop the slaves from killing themselves.



Now don't get me wrong: I'm not crying for these people.  They in fact are getting what they deserve for being hapless sheeple.  They do not take the time to figure out what is going wrong (and the Great Firewall of China is there to make that even more difficult) but even if they knew exactly what was going on they cannot easily change things because the people there are completely disarmed. Most have never even seen a gun and even fewer have fired one.  If you can't or won't protect yourself it is the sworn duty of your fellow man to exploit you!  Since they have learned to accept that, I have learned to stop feeling sorry for them. 

In any case, back to Japan where Abe seemingly prints all the money he wants and all it does is rack up more government debt that nobody ever intends to pay without reliably creating the desired inflation/currency devaluation.  Well folks, it is now to the point of being a huge and obvious joke.  Fundamentals are not running things, herding behavior is.  And the citizen herd is far bigger than the government herd.  Sooner or later Abe is going to do something and the people are just going to give up on the Yen and on anyone associated with it.  Then they will have a local currency event that eventually brings down the entire global system of debt and debt based money.  I suspect that at the end of the day Japan will probably go straight from deflation into hyper inflation at some point.  I think this video shows you what that will look like (Spoiler alert: this video is not for the squeamish).