World Trends

  • What Happens If “Lehman 2.0” Hits?

    Akio KAWATO . Today, May 7, the Japanese stock market surged, with the Nikkei reaching historic highs. Hopes for a ceasefire involving Iran also helped push stock prices upward. Yet beneath the surface, the financial markets of both Japan and the United States are showing troubling signs. In both countries, long-term interest rates are rising—meaning confidence in government bonds is…

  • The Foundations of “Modernity” Are Gone—So We Need New Institutions

    　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　.Akio KAWATO In Japan, Europe, and the United States, we still debate politics using the modern values of “freedom” and “democracy.” But the real foundation supporting those values was the economic development of Western Europe since the 17th century—above all, the dramatic rise in productivity brought by manufacturing. As manufacturing expanded, more people were able to earn solid middle-class incomes…

  • Is Lehman 2.0 Around the Corner? What Happens If It Hits?

    　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　Akio Kawato In September 2008, the collapse of Lehman Brothers brought the world economy to a temporary halt. Today, excess liquidity in Japan and the United States, stock market bubbles, and ever-expanding fiscal deficits are raising fears of “another 2008.” Yet even if the next crisis resembles 2008, the scenery will be somewhat different. That difference is worth examining. .…

  • Putin’s September Magic: Managing Russia’s Parliamentary Elections

    Akio KAWATO (Japan’s DCM in Moscow 1998~2002) Lately, Russian President Vladimir Putin seems to have lost momentum. His approval ratings have been slowly slipping. Even a look at the Kremlin’s official website shows fewer presidential events, both domestic and diplomatic. During the International Women’s Day ceremony in early March, television cameras caught him coughing rather unnaturally, which sparked quiet speculation…

  • The End of Gunboat Taiwan Policy

    Watching the U.S. Navy hesitate to push into the Strait of Hormuz during the current Iran conflict, one begins to wonder whether the old scenario—U.S. carrier strike groups rushing to the rescue in a “Taiwan contingency”—has already lost much of its credibility. That does not mean Taiwan is defenseless. Quite the contrary. Taiwan could potentially destroy a Chinese amphibious invasion…

  • Does the Iran War Herald the Advent of the “Euro Renminbi”

    Akio Kawato Since the 2008 financial crisis and the COVID shock of 2020, the United States has continuously expanded the supply of dollars. Federal debt has now exceeded the size of annual GDP. Policymakers fear that, at some point, this could erode confidence in U.S. Treasuries, trigger a surge in interest rates, and destabilize public finances. . Could the current…

  • After America: What Middle Powers Can Still Build

    Iran ceasefire talks are now beginning. Had the war continued, Iran’s retaliation might well have threatened the very survival of Gulf civilization itself, while also exposing the limits of U.S. military power and potentially bringing an end to America’s unipolar dominance. The ceasefire has, at least for now, bought everyone some breathing room. . Even so, this latest attack on…

  • The AI Rush; But Does It Have To Be So Expensive?

    These days, whenever AI comes up—NVIDIA, xAI, all that world—people casually throw around figures in the tens of billions of dollars. It sounds almost surreal. Then again, maybe this is exactly how early 19th-century Britain must have felt when iron, railways, and chemicals suddenly replaced cotton as the engines of growth. Compared with spinning mills, the money required must have…

  • Dark Clouds Gathering on Putin’s Horizon: Russia’s September Parliamentary Elections

    The war in Ukraine has now entered its fifth year. Not only Ukraine but Russia itself—despite being a great power—has been badly worn down. The recent surge in oil prices caused by the war with Iran has given Moscow some temporary breathing room. Yet the underlying strains remain severe. Thousands of tanks and armored vehicles have been destroyed in Ukraine,…

  • Living in the Age of the Bully

    I finally managed to revive my blog, yet somehow I cannot quite summon the energy. In times like these, no matter what one writes about the world, Trump the realtor arrives like a bulldozer, flattening every counterargument and dissenting voice in his path. Even when he himself seems to hesitate, pressure from America’s evangelicals and MAGA forces (though those circles…