by Kirk Elliott, Ph.D.
The earthquake and tsunami that rocked Japan will also turn into an economic tsunami that will devastate the rest of the global economy. Within five days of the earthquake and tsunami, the Japanese Nikkei stock market index was down 21%! European and U.S. stock markets also were heavily impacted. The aftermath of the physical/economic/political turbulence will more than likely give birth to QE3.0. Japan’s giant car industry has shut down over fears of the economic impact.
What about the global impact of this? As bad as things are in Japan, things could ultimately be just as bad in the rest of the world. When there is a spike in demand for capital, which Japan needs to keep their already sluggish economy afloat, they will need to sell their most liquid assets to generate capital quickly. What is their most liquid asset? U.S. Treasuries! Uh ohhhh.
When Japan joins China and starts dumping their U.S. Treasuries, it may signal the beginning of the end of life as we know it here in this country. Welcome super inflation and hyperinflation in pretty short order. Please pray. Pray for the people in Japan whose lives are in shambles.
Pray for wisdom in navigating this crazy economic mess we are living in. Pray for God’s grace and mercy to be plentiful. We need it! Pray, protect, and preserve!!! The world is changing before our very eyes, and we need to be nimble enough to adapt on the fly. Business as usual and the old rules of the game no longer apply. God bless you all.
