Nomura, Japan Society, WBC, and Columbia Business School Center on Japanese Economy and Business sponsored a panel:

America Has Voted: Impact of the New U.S. President on Asian Markets

Leslie Norton, Asia for Barron's the panel moderator opened with:

"The United States has selected its leader for the next four years. In addition to affecting America's relations with foreign countries and altering the course for myriad domestic issues, the choice of a new president will have a profound influence on Asia's financial markets. Our panel of experts will examine how stock markets across the region have reacted to the selection of President Barack Obama and how Asian firms have adjusted their investments in the United States. In addition, our panelists explore the possibility for broader cooperation among U.S. and Asian policy-makers as they seek to address global economic challenges. Finally, as the direction of U.S. financial policy changes to reflect the priorities of the new administration, the group discusses the relative likelihood of certain global market changes over the next four years."

Panelists included:

• Alicia Ogawa, Columbia Business School
• David Resler, Nomura Securities Int'l, Inc.
• Jeffrey Young, Platinum Grove Asset Management, L.P.

If you have been following the United States financial crisis, the panel discussion was a more personal continuation of the conversation with the panelists sharing their recent experiences in Japan. What follows are some memorable points from the hour and half panel discussion.

Alicia opened with her view from a recent trip to Japan; there is much enthusiasm for Obama, especially in the town of Obama. As well, there is an appreciation for the ability for the people to elect who they want to govern them and to have someone new and young. There has been a lack of a new political generation in Japan.

That said she added that in general there is an underlying sentiment of disappointment that U.S. didn't take its own advice, that they gave Japan in the 90s. The U.S. should have let more of the investment banks and automakers fail.

Given how tightly our economies are linked through their import/export relationship, the panel was asked to hypothesize which country may be the first to leave the recession; the U.S. or Japan:

They agreed it would be the U.S. for the following points:

• Japan's economy is still heavily dependent on manufacturing and is struggling to compete with Korea and others
• Japan has an aging population base as well as a declining population
• Japan depends on banks to fund all venture business investment
• U.S. has an opportunity in being second to Japan's 90s economic crisis and learn from their experience

Several of the panelists made a point to note that the Central Bank and Fiscal Policy need to work together. This has not been the case in Japan and potentially one of the reasons why they had a hard time exiting their 90s recession. One undid the effects of the other to create a rollercoaster ride of adding money to the economy and removing it from the economy. When the private sector is not sure of how the monetary and fiscal policy will play out in the coming year, then private sector sits on hands and growth is inhibited.

David pointed out that it is clear from the U.S. experience in the 30s that we need to stay away from implementing tariffs and focus on removing obstacles, potentially labor related, so that our companies may have an opportunity to complete in the global economy. The introduction of trade tariffs real hurt the U.S. recovery in the 30s. He believes that all the cabinet members well understand this issue. David finished with that this is not to say that they wont' make other mistakes.

Alicia pointed out that there is an opportunity to learn from the Japanese in restructuring companies and regarding renewable energy sources. Potentially, Japan might benefit by exports in our new use of renewable energy technology here in the U.S. As well, Japanese during the 90s spent some time restructuring failing companies and that is worth us understanding better what they did to help failing companies.

Encouraged by a final audience question on the fate of the Yen, there was a discussion on why the Yen is doing so well. Jeff suggested people are unease and are keeping the money that they do have in their own local currency. Given there is a very limited supply of Yen and strong demand, this is driving the price of the Yen up.