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Dec 29, 2011
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U.S. protests won’t stop Japan’s yen meddling

By Wayne Arnold
The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

The U.S. Treasury has rightly criticised Tokyo for trying to artificially weaken the yen. Currency intervention of the kind Japan wheeled out after March’s earthquake, and again in October, has a limited impact, and exporters have learned to live with a strong yen anyway. But fears that traders see the yen as a one-way bet mean more meddling is likely.

Dec 20, 2011
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South-East Asia could be 2012′s safest getaway

By Wayne Arnold
The author is a Reuters Breakingviews columnist. The opinions expressed are his own

South-East Asia offers an enticing getaway in a stormy 2012. Growth will slow along with the global economy, but Asia’s emerging economies should still outpace developed neighbours. That’s likely to cool stocks, but as interest rates fall to offset slower growth, government bonds should benefit. The biggest risk is that retreating European and other foreign funds tug currencies down and push bond yields higher. But the risks look balanced. Malaysia, the Philippines and Thailand stand out as the region’s safest harbours.

Even a slowing developing Asia should still manage 6.6 percent growth in 2012, according to Nomura. Economies most reliant on exports, particularly of electronics, will be hit hardest, like Singapore, Taiwan and Malaysia. But these and other developing Asian governments have finances Europe can only envy – even Malaysia and the Philippines have less debt relative to GDP than either Germany or France. That means they can afford to spend and cut interest rates, which should lure more local investors into their bonds.

Dec 16, 2011
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Olympus must dump its board to save itself

By Wayne Arnold
The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

Olympus’s board wants to hang around until March and possibly April. That’s too long. Though the three directors implicated in the Japanese company’s ongoing accounting scandal have resigned, the remaining bunch failed to spot their scam. They also fired the only director brave enough to cry foul once it emerged. The company still needs to placate regulators, woo creditors and repel litigious investors. For that, it needs a fresh board as soon as possible.

Dec 14, 2011
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Asian banks can’t fill gap as Europeans retreat

By Wayne Arnold
The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

The retreat of European banks from Asia could create a $390 billion hole that drives up borrowing costs and crimps growth. Asia’s companies are used to a world where dollars were cheap and abundant. The region’s banks are flush with local currency deposits, but have to borrow most of their dollars. So as Western banks pull back, Asian lenders may find it difficult to fill the gap.

Dec 7, 2011
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Olympus’ ex-CEO no shoo-in for post-scandal return

By Wayne Arnold
The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

Michael Woodford may not be the right fit to run a post-scandal Olympus. Two months after he was fired for blowing the whistle on an accounting scandal, the former chief executive wants to return to the helm. Woodford knows the Japanese group well, but his short, divisive tenure as CEO makes him an awkward choice. Though Woodford should make any shortlist, Olympus shareholders would be wise to consider other candidates.

Woodford is rounding up a posse of investors and bankers to oust Olympus’s board and put him back in charge. He’s promising to shed jobs and side-show units like face cream in an effort to boost earnings at Olympus, which has 70 percent of the global market for scopes that peek into people’s insides. The trick will be mustering shareholders who’ve owned at least 3 percent of the stock for at least six months and can force an extraordinary general meeting. Some of the biggest and most vocal – like Southeastern Asset Management – can’t do that because much of their stake is held on behalf of clients.

Dec 1, 2011
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Myanmar forms centre of economic love triangle

By Wayne Arnold
The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

Myanmar has been thrust into the centre of an economic love triangle. The visit of U.S. Secretary of State Hillary Clinton confirms the strategic importance of the former pariah state for the United States, but also for China and India. For would-be investors, the biggest risk may simply be that Myanmar gets too popular, too quickly.

Nov 28, 2011
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China won’t be Asia’s importer of last resort

By Wayne Arnold
The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

China’s manufacturing engine is sputtering, boding ill for other Asian exporters like Japan and South Korea. They’re counting on China to offset slowing demand from the United States and Europe. But much of what China imports goes into making its own exports. And even bona fide domestic demand left is likely to be affected by a trade slowdown.

Oct 17, 2011
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Olympus fiasco strengthens the case for Japan reform

By Wayne Arnold
The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

Olympus’ embarrassing decision to dump its foreign chief executive two weeks after naming him to the job shows that reform is a slow and fitful process. Michael Woodford was brought in to carry out a house-cleaning at the Japanese camera maker, and became one of the country’s handful of non-Japanese corporate bosses. That the board decided to fire him so soon shows the medicine was distasteful. It also strengthens the case for a bigger dose.

Oct 7, 2011
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Trouble knocks for Korea’s indebted households

By Wayne Arnold
The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

South Korea has assumed battle stations. Investors’ retreat from emerging markets has exposed the country’s reliance on short-term foreign credit, sending its markets spinning and prompting Prime Minister Lee Myung Bak to call the first economic crisis meeting in almost a year. Banks and government balance sheets look sturdy, but an economic slump centred on indebted households is a real risk.

Aug 16, 2011
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World must let U.S. win currency war

By Wayne Arnold
The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

Currency wars have returned, and this time the world has little choice but to let the United States win. The Fed’s vow to keep U.S. interest rates near zero until 2013 heralds a prolonged devaluation of the dollar. For export nations, the temptation is to fight back by pushing their own currencies lower. That’s a mistake. Tit-for-tat devaluations are futile, and would delay the recovery of exporters’ number one customer, turning a global slowdown into dreaded stagflation.

    • About Wayne

      "Wayne Arnold is Breakingviews’ Hong Kong based Asia strategist, with 20 years of experience in the region. From 1999 to 2008, he served as the Southeast Asia business and finance correspondent for The New York Times and the International Herald Tribune. In 2008 he helped launch a new daily newspaper in Abu Dhabi, The National, where as its economics columnist, he chronicled Dubai’s financial meltdown. He was previously a columnist and reporter at the Wall Street Journal in Hong Kong and Bloomberg in Tokyo. His stories have spanned from Japan’s financial collapse in 1991 to the global economic crisis. ..."
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