July 25, 2010
America is a country that brings America’s finest intellects into its government.
This is particularly true in finance and national defense.
(More on this next time.)
America was once the world’s greatest financial power, industrial power, and technological power as a hegemonic nation.
It was a country that served as a model of the three pillars.
As already stated, America, as a hegemonic nation, continued nurturing poor countries so that they could grow larger…As a result, and particularly because of Japan’s miraculous recovery, the weight shifted toward its position as a financial power to the extent that its manufacturing industry began to show signs of decline.
America is now in a state of great urgency, attempting to correct the industrial-power and technological-power portions while also raising its educational standards.
The only thing we must do now is concentrate on the single objective of turning Japan into a financial power, the only component it has lacked.
We must direct 10 percent of private financial assets toward acquiring shares in the countless outstanding companies that exist throughout every field in Japan…while the products created through their technologies and the technologies themselves still command large shares of the global market…before those technologies flow out of the country or are stolen through headhunting and so forth…because the collective body of these many companies is the strength of the Japanese economy.
The method is exactly as described in the chapter concerning twenty-five years ago, when the Turntable of Civilization revolved toward Japan.
If short selling is said to be necessary, it need only be permitted under the existing restrictions on short selling that are currently applied during regular trading sessions.
As already stated, let us suppose that as much as 500 trillion yen of the national wealth accumulated through the efforts of the Japanese people has been siphoned away by foreign capital…
By a curious coincidence, that amount equals the more than 500 trillion yen held in postal savings, which was America’s greatest objective in the annual reform requests that the United States presented to successive Liberal Democratic Party governments every year…
Let us bring that chapter to a close by regarding it as the interest paid to the United States, which helped Japan grow to its present size.
From today onward, however, matters will be different.
We are facing an outrageous situation in which the IMF is making recommendations, as though Japan were an emerging nation, that the consumption tax should be raised to 15 percent beginning next year.
As already stated, because there are no destinations for investment, 175 trillion yen has had no alternative but to be directed toward government bonds.
Let us immediately direct 100 trillion yen of the money stagnating in these banks into the stock market…
There are quite a few major corporations paying annual dividends of 3 percent or more…
Generally speaking, stocks with high dividends have low volatility…many of them are stocks that so-called individual investors avoid because, although stable, they are uninteresting…
Representative examples include NTT and stocks related to domestic demand.
If 1 percent of private financial assets—10 trillion yen—is directed into daily trading, foreign capital’s share will immediately fall into the ten-percent range, making it impossible for foreign investors to continue doing whatever they please.
Domestic institutional investors will also be able to participate in daily trading with confidence…
That is because Japanese stocks will become stable…
Into that market, 100 trillion yen from the bank funds described above should be directed by making dividend income tax-free.
(However, this must not be permitted for banks operating at a loss or banks earning profits lower than their dividend income.)
Foreign ownership as a proportion of the total number of issued shares will also fall from its current level of approximately 45 percent to below 30 percent.
Consequently, the foolish present situation in which Japanese stocks are trampled upon at will by foreign capital…and continue falling for twenty-five years…can instantly disappear and be eliminated like mist.
It goes without saying what the result will be.
Japanese stocks, having become the world’s most stable major market, will become a destination for risk avoidance, and whenever anything happens, Japanese stock prices will rise.
An increase based on sound supply and demand, entirely different from today’s appreciation of the yen, will begin.
If Japan finally accomplishes what it should have done over these twenty-five years as the great economic superpower and hegemonic nation described above, the IMF will be astonished and satisfied that Japan has finally understood.
It will never again say anything about the consumption tax.
If foreign capital demands that its dividends and trading profits also be made tax-free in the name of fairness, Japan need only reply that the portion spent within Japan will be exempt from taxation—naturally, upon presentation of receipts.