Apparently, a rising tide of Japanese yen has lifted all boats elsewhere in Asia. But in North Korea, the financial situation is nothing short of a shipwreck.
Two days after Japan's central bank announced plans to fire up the monetary printing press in an attempt to increase liquidity, fight off deflation, and help protect the nation's export market, Asian markets continue to climb. Japan depends on a weakened yen to make the price of its products attractive to overseas buyers, and export-dependent Honda
But while Japan tries to stave off deflation, North Korea is stamping out runaway inflation with an iron fist. Wresting control over the economy back from the street markets that have popped up in recent years, Kim Jong-Il's government is revaluing its currency, the won, at a rate of 100 old won to 1 new won. The Communist regime is threatening "merciless punishment" for running afoul of the new rules, even as residents head for the black market to convert their old money into U.S. dollars and Chinese yuan. Merchants are said to be in despair, and one activist reports that "business and market activities were all suspended" because "people have no money to engage in business."
It's a crazy world out there, Fools. Are you surprised by the positive reaction to Japan's yen devaluation? Are you not surprised by the actions in one of Asia's most reclusive and oppressive dictatorships? Let's hear your thoughts in the comments box below.
