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Ways of the World

Carol Stone, business economist & active Episcopalian, brings you "Ways of the World". Exploring business & consumers & stewardship, we'll discuss everyday issues: kids & finances, gas prices, & some larger issues: what if foreigners start dumping our debt? And so on. We can provide answers & seek out sources for others. We'll talk about current events & perhaps get different perspectives from what the media says. Write to Carol. Let her know what's important to you:

Monday, March 14, 2011


We have so much to talk about – a follow-up to our article about oil prices last week, the "sequel" to it on food prices, the condition of state and local government budgets and so on – but clearly this Monday, there is only one topic: Japan.

First, here is a statement from the Archbishop of Nippon Sei Ko Kai, the province of the Anglican Communion in Japan: Archbishop Uematsu describes about the churches there the same kinds of issues we are hearing about homes and other buildings: worrying that facilities near the sea might have been totally destroyed and simply not knowing their condition and/or the condition of their people due to the breakdown in communications. Writing Monday afternoon Tokyo time, he says that he has spoken to the Bishop of Tohoku, who was able to phone him Saturday. The Archbishop is establishing relief efforts. Indeed, we also refer you to the site of Episcopal Relief & Development,, which is already mounting a fund-raising effort here in the U.S. for this purpose. Archbishop Uematsu asks our prayers as well. Absolutely.

O God,
who in Jesus stills the storm and soothes the troubled heart,
bring hope and courage to all
who are affected by this earthquake as we wait in uncertainty.
Bring assurance that you will be with us in whatever lies ahead.
Give us courage to endure all that we now face,
for you are our refuge and strength.
You are God, and we need you.
We pray in the name of Jesus Christ, our Savior and Lord.
[adapted from Evangelical Lutheran Worship: Pastoral Care, page 174.
© Evangelical Lutheran Church in America. From Accessed March 14, 2011.]

Some of the Disaster's Impact
In my former Wall Street career, I worked for the New York office of Nomura Securities, the largest Japanese securities dealer, and I still receive email material from my colleagues there. My inbox began to fill at midday Sunday – that would have been shortly after midnight Monday morning in Japan – with extensive analysis of the impact of the earthquake and tsunami on the industry of the country. Here are a couple of the major points.

The region directly impacted by the quake encompasses plants and other facilities accounting for just under 7% of industrial output in Japan. The industries with the largest concentrations there include mining, agriculture and food manufacturing, metals – especially steel, electrical machinery, precision equipment and electric power generation. The electrical machinery and precision sectors contain a large amount of IT-related industry. In this last category, semiconductors are very important and there is also a major manufacturer of the screening material used on LCD TVs. Sony, Pioneer and Casio are familiar names whose plants are presently shut down. In some cases, the shutdown is due to power outages, not plant damage, so those could reopen relatively quickly, but there may well be bottlenecks in world semiconductor production and availability.

Among food products, there are a number of beer breweries in the region. Asahi, Kirin and Sapporo brands are particularly affected, with 10% to 40% of each company's total output impacted. At one plant, storage tanks collapsed, at another, the plant itself suffered major damage, and electricity seems to be out everywhere.

Obviously, by contrast, some sectors will get boosts due to the nature of the disaster. Companies that inspect and repair nuclear power plants and construction and construction equipment-makers are examples. In a different vein, the Nomura analysts cite Alfresa Holdings and Medipal, which are wholesale distributors of pharmaceuticals and cosmetics; these and other companies "may suspend regular wholesaling activities . . . to create emergency distribution networks in the Tohoku region".

The loss is great, unimaginable for us. But in the Japanese reaction, we see immediate evidence of adaptability and courage in the face of the sorrow and mourning. Still, even as the Nomura commentators try to describe for us a basic assessment of this massive disaster for business and industry, they also give a caveat; that statement is not meant to tug at readers' hearts, but it does: "This report is based on the existing knowledge of our analysts . . . . We have not yet discussed any issues with company representatives, as disaster response is currently their top priority." Indeed it is. Just now, as we have finished typing this paragraph, a new headline reports yet another explosion at Unit 2 of the Fukushima Daiichi nuclear power plant. Lord, have mercy on them.

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Anonymous Carl Peter Klapper said...

As several commentators have pointed out, the nuclear accident brings us full circle to the price of oil. With nuclear energy being questioned worldwide, demand is likely to shift to other energy sources, including petroleum.

Given the constant mention of petrol as a "necessity", it looks like any rebuilding following the disaster will follow the same automobile-based development which made Japan so energy dependent in the first place. That would be a shame.

3/16/2011 3:12 PM  

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