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July 17, 1998
Japanese election results and a new bailout for Russia have relaxed the fears which had helped bonds for the last several months. Mortgage rates are steady, but T-bond yields rose decisively, from the 5.50s to the 5.70s.
Right or wrong (I think wrong), markets assume the Liberal Democratic Party's losses will force it to accelerate reforms in Japan. Traders handicapping the new Prime Minister have Keizo Obuchi as the status quo choice (new panic helps bonds), and Seiroku Kajiyama as the reformer (no panic, rates up).
Some Japanese commentators do not support this view. They say the LDP losses were the result of a protest vote, and there are just as many protesters in Japan who want a return to the old days of government hyper-control (like the Stalin vote in Russia) as want reforms. Further, this is no choice between tortoise and hare, just two more tortoises.
Look for sham reforms, and renewed fear of meltdown.
But, speaking of two tortoises....
This column has relied for a decade on politicians to provide entertainment, especially during the hot, news-poor silly season. This year, things looked bleak: the upcoming Congressional election is a total yawn. And, as this is a family column, I can't bring myself to discuss the President's... whatever... whomever; or print the name of that awful Mr. *****.
Rescue is in sight. In two short years, we'll elect a new President, and the election of double-zero is already living up to its name.
Young Bush, Texas Gov with hat and wallet thrown in Presidential ring, was asked if he -- unlike his Dad -- had a vision for the future of the country. He said "Yes".
On Wednesday, his likely opponent, Al Gore, noticed an opening, got wound up on his key issue and thundered to CNN in his usual electrifying style: " Con-gress, get tha-t Ky-o-to glo-bal warm-ing trea-ty signe-d !! IT'S SWEL-TER-ING OUT HE-RE !!!! "
Global warming may turn out to be a big deal, but... Jesus, Al... before the first human lit a CO2-belching fire, July was hot. Too many years in government air-conditioning have frozen your brain.
There is a way for naught-naught to turn out okay. Bush The Rich figures to beat Stone Cold Al, but we'll be saved when the Republicans lose control of Congress -- an outcome Newt The Bomb and Iron My Own Shirts Lott richly deserve.
Latest example: House Republicans finally authorized more money for the IMF (about time: the new money for Russia cleaned out the Fund), but required that nations receiving aid may recommend only "natural" family planning.
Opposite party control of the White House and Congress has been a nice safety feature, and should minimize the damage into the " Tw-en-ty Fir-st Cen-tur-y !! ".
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