Japanese Miracle Resurrected
The Japanese economic miracle, which died more than two decades ago, may be in the early stages of resurrection. First-quarter gross domestic product (GDP) rose 3.5%, a number that was not matched in the same period by any of the EU economies or the United States. Japan’s new central bank bond-buying plan and the government’s stimulus may allow the recovery trend to rush into the current quarter and beyond. Bloomberg said of Japan’s GDP jump:
Private consumption, making up 60 percent of GDP, contributed 2.3 percentage points to the jump. Nominal GDP, which is unadjusted for changes in prices, rose 1.5 percent, also the most in a year.
Today’s report shows while consumers — aided by a stock-market surge — are responding to the reflation campaign mounted by Prime Minister Shinzo Abe and Bank of Japan chief Haruhiko Kuroda, companies remain cautious. That may change as the yen’s 20 percent slide against the dollar in the past six months spurs profits and Abe’s administration embarks on reducing regulations.
“Japan is clearly back from stagnation last year,” said Naoki Iizuka, an economist at Citigroup Inc. in Tokyo. “The key from here is whether Abe can unveil a strong growth strategy. If he succeeds, that will boost business investment to support growth.”
J.P. Morgan Keeps Secrets
J.P. Morgan Chase & Co. (NYSE: JPM) investors feel cheated. The bank has stopped issuing updates on voting results from the bank’s proxy. This will leave investors in the dark as they watch whether CEO Jamie Dimon might lose his job as chairman. The New York Times reported on the lack of shareholder access:
Now, in the midst of one of the most closely watched investor votes in years — over whether to separate the roles of chairman and chief executive at JPMorgan Chase — that protocol has changed. The firm that is providing tabulations of the JPMorgan vote stopped giving voting snapshots to the proposal’s sponsors last week. The change followed a request from Wall Street’s main lobby group, the firm says.
The pension fund shareholders that are promoting a split at the top of the bank are crying foul. Knowing the current tally is critical for both sides in shaping their campaigns, they say — cutting off access to them gives JPMorgan, which is getting frequent updates, an upper hand.
“They have changed the rules in the middle of the game and it has created an unfair advantage,” said Michael Garland, assistant comptroller who heads corporate governance for the New York City comptroller John Liu. “It’s like playing a game where only the home team gets to know the score.”
SUVs Fail Safety Test
Small SUVs have enjoyed raging sales because of their versatility and gas mileage. The sales of some brands in the sector may plunge. New data from the Insurance Institute for Highway Safety (IIHS) has raised concerns about the safety of several 2013 models. USAToday said of SUVs tested by IIHS:
Five small crossovers flunk the new small overlap crash test, but not the 2014 Subaru Forester.
The Forester was the only one of 13 small crossover SUVs to earn an overall rating of good in the test, the Insurance Institute for Highway Safety says. The 2013 Mitsubishi Outlander Sport got an acceptable rating.
Rated marginal were the Nissan Rogue, Mazda CX-5, Honda CR-V, Jeep Wrangler and Volkswagen Tiguan.
Five small crossovers were rated poor included the Ford Escape, Jeep Patriot, Buick Encore, Kia Sportage and Hyundai Tucson.