A critique of Japanese economists who blame the decline of the semiconductor industry on management or technology, while ignoring the reality of state-driven currency manipulation in South Korea and China.

Even If You Run 100 Meters in 10 Seconds, You Still Lose to a Child
February 27, 2013

This morning’s Asahi Shimbun carried a special feature in which an editorial board member interviewed a certain economist.
But this economist was no different from the rest of Japan’s economic commentators.

In a capitalist economy such as Japan, stock prices in the market had been falling by as much as 80 percent for an extended period, yet there is no trace of reflection on the fact that they stood idly by and did nothing.
On top of that, they say things such as: Japan’s semiconductor industry collapsed because it lost competitiveness, or because of management and technological failures.

I must state unequivocally that this is the common stupidity shared by economists who appear in the mass media today.
This is a problem so simple that even a kindergarten child could grasp it.

Who are the competitors of Japan’s semiconductor and electronics manufacturers?
First, South Korea. Second, China. That much is obvious.

Since the national financial collapse ten years ago, South Korea’s currency market has been so small that for the Korean authorities it has functioned like their own backyard.
They have made repeated, massive interventions in that market.
As a result, the won has fallen 60 percent against the yen.

To this economist I would say:
Even if you are a runner who can sprint 100 meters in 10 seconds, if you are forced to run 160 meters while your opponent runs only 100 meters, you would lose even to a grade-school child.

Truly, the folly of Japan’s economic commentators has reached its extreme.
As for China, needless to say, it is a state-controlled currency regime.