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What is the impact of Abe’s death on the economy?
On July 8, 2022, former Prime Minister Shinzo Abe, who was giving a street speech in Nara Prefecture, was shot dead. Although it is a shocking incident, the major media do not use the words “terrorism” and “assassination.” It is not clear at this point whether the grudge against a particular religious group led to the shooting, but it is a clear violence and no logic is allowed. The fact that the former prime minister was “assassinated” will bring about major changes in Japanese society in the future.
It means that people’s safety consciousness and social culture will change. There is a big difference between a society that imagines that everyone may have a firearm and a society that does not. People who appear in front of an unspecified number of people must be aware of the possibility of being attacked.
I heard the first report about Mr. Abe when I was having a meeting with business people. Everyone there was speechless, silent for a few seconds, and unable to clean up their heads. After a while, someone sighed and then muttered, “I wonder if this will change economic policy.”
The stock and financial markets reacted immediately in response to the press. The stock market on the 8th fell by about 200 yen from the morning, and the exchange rate shook from 136 yen to the 135 yen level, albeit slightly. This is an unstable move and we do not know if it will lead to future trends.* Editor’s note: On the 11th, the yen temporarily fell to the 137 yen level, the first level in 24 years.
Even if one big politician is lost, good policies will continue to be implemented, and it may be cool to think that “there is no impact on Japan’s fundamentals.”
On the other hand, I have been very worried recently. The author sells lectures and teaching materials to detect the bankruptcy of business partners and suppliers in advance, but the interest of customers is high these days. This is because the sense of crisis that it may be difficult for business partners and suppliers to continue their corporate activities as before has spread to the field level.
The following pages are my hypothesis, but I would like to consider the economic impact of the death of Mr. Abe, especially the problems faced by corporate bankruptcies and small and medium-sized enterprises.
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