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Thursday, March 24, 2011

The Insidious Effects of Japan's Disaster

I came across this well written article today and am linking it here. The disaster in Japan will have long term health consequences for the whole world, especially those in the Northern Hemisphere. But the consequences will be near catastrophic for the world from an economic perspective. Although this writer is confident that Japan will rebuild rapidly, I am not so sure. For one thing the nuclear catastrophe there is far from over. Why the Japanese government not order a Chernobyl solution immediately is beyond me? Given the scope of the potential consequences and the fact that more than one reactor was irreparably damaged; the safest solution would have been to entomb the whole complex like Chernobyl immediately. Even if they do that now, which I believe they will have to, the effects of the leaked radiation could be felt for decades in Japan and beyond. Secondly I believe that there are bigger disasters in store for the world this year and beyond. Sooner rather than later, the world will run out of resources and finances to cope with all the catastrophes that are being inflicted upon it. So I do not believe that Japan will ever go back to being the nation it was on March 10, 2011. I also believe that this disaster, in concert with a with the widening Mideast and Arab world crisis will lead to much higher energy prices that in turn will sink the US dollar and throw the whole world into a depression. The following quote from the article sums up my feeling that this crisis may sink the whole world economically, and perhaps in other ways not yet discernible.

“But the financial fallout from the crisis looms even larger than the health, energy, or industrial issues. The Japanese people are stoic, disciplined, and very hardworking. Recovery in Japan is likely to be faster than many expect. However, in order to repair the flood, quake, and nuclear damage, Japan will likely need to spend trillions of dollars (hundreds of trillions of yen). This is the crisis that may sink the developed world.” Read More

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