One thing that I think curious is overreaction on Radiation issues across the US, which dropped two nuclear bombs in Japan. They claim that nuclear bombs helped hasten the end of war so that millions of lives, be they Americans or Japanese, would have been saved.

Many wise readers would hopefully realize how ridiculous it is, though I'm afraid that there are still not so wise people out there. For those Americans, it looks like OK to contaminate other countries with radiation, but things are completely different if radiation flows in their country, namely the US. If radiation helped millions of lives, why don't you come up in Japan and swim off the coast of Fukushima with your favorite animals like dolphins or whales? Those animals are asking for help in the radiation-rich sea, saying "Help me, please!" Hey, Greenpeace or Sea Shepherd or whatever, jump into the sea off Fukushima and help them!

For those people, this would be appropriate.

Well, ... let's take a look at the resilience of Japan's economy. I mostly agree with an article on the post-quake Japan's economy by Charles Dumas in the FT.

He says:

What is true is that the effects of the disasters will boost demand in the latter part of this year as reconstruction gets under way as well as clearly having cut into productive capacities to some degree.

…

A weakening of the yen should add to demand and raise the possibility of inflation.

…

The effects of the disasters for the next year, therefore, involve a clear and desirable tightening of the domestic Japanese demand/supply balance, plus some improvement of net exports demand. It seems much more likely than not that GDP will be higher in the second half of 2011 and early 2012, rather than lower, as a result. It is possible this could lead to a virtuous circle, driven by stronger demand.

As he notes, the yen is clearly weakening, which makes it possible to advance exports.

And, it seems that rebound in industrial production is likely after the big earthquake: Japan in 1995, and Chile in 2010.


Especially, construction could see the most acute rebound after the quake, which was, in fact, the case with the Kobe earthquake in 1995.


So, if you're, at least, in the construction business, Mr. Trump would likely say:


But the problem is how much the economy rebounds. We understand that economic activity bounces back soon after the quake, but is there anything else that is missing in the context, Mr. Dumas?

Yes, that's electricity.

As I wrote the other day, there is a very strong connection between electricity and economic activity. If electricity is cut by a significant amount, it could possibly discourage the business to produce more.

Japanese officials are reported to consider to cut electricity consumption by one-quarter this summer in Tokyo.

Japan's trade ministry is considering ordering big industrial electricity users in Tokyo Electric Power Co's service area to cut their peak summer power consumption by 25 percent, a ministry official said, as efforts mount to avert crippling summer blackouts.

This could be a big risk scenario for the Japanese economy, even taking into account a weak yen and huge reconstruction demand.