Slightly Insensitive - FTSE 100 (Japan Tsunami)

le_loup

Why is it assumed that such an event would be bad for the market? Given the rebuilding that will be required, the GNP will rise, business activity will rise, the only losers are the insurance companies.
That makes me sound indifferent to the suffering, which I am certainly not guilty of.

Reaper

As I said on another thread the events in Japan will have no noticable effect overall on the country's economy, and no effect on the FTSE other than possible irrational short term knee jerk reactions.

jimjames

Reaper wrote: »

As I said on another thread the events in Japan will have no noticable effect overall on the country's economy, and no effect on the FTSE other than possible irrational short term knee jerk reactions.

Having just seen the TV pictures this morning, if they are showing what is suggested and the nuclear power station has exploded in the same way that Chernobyl did then I think the effect on Japan could be immense. If confirmed the markets may well go into freefall on Monday as such a huge area of the country would become uninhabitable for decades.

Pure speculation at the moment but the outlook doesn't look good from the pictures.

Voyager2002

jimjames wrote: »

Having just seen the TV pictures this morning, if they are showing what is suggested and the nuclear power station has exploded in the same way that Chernobyl did then I think the effect on Japan could be immense. If confirmed the markets may well go into freefall on Monday as such a huge area of the country would become uninhabitable for decades.

Pure speculation at the moment but the outlook doesn't look good from the pictures.

No, not like Chernobyl. The reactor is a PWR, very different from that at Chernobyl, and was not in operation at the time of the accident (another key difference). The situation is extremely serious, but more like Windscale or Harrisburg than Ukraine, so a disaster rather than a catastrophe.

le_loup

Classic problem with rolling news! Let's all panic ... until we know better.

sabretoothtigger

^^ That might cause prices to fall alot but I dont believe the earthquake is Japans greatest problem financially speaking. They have 200 earthquakes a year, this one was massive but it could have been worse still

Why is it assumed that such an event would be bad for the market? Given the rebuilding that will be required, the GNP will rise,

No that is a fallacy. Destruction does not cause wealth to increase, it might increase activity but ultimately its not an increase in value. Thats classic government thinking, hence why trillions have been wasted and this is the greater longer term problem.
Kobe disaster did not help Japan 15 years ago, see below

. 6,434 people in the city were killed, 212,443 were made homeless, and large parts of the port facilities and other parts of the city were destroyed

Despite all this 'stimulus' the Nikkei stockmarket 16 years later is half what it was then


Japan government already borrowed 200% of the countrys annual production, the greatest fall is likely to occur in their currency not companys who will largely surpass this latest natural problem

jimjames

Its obviously true that the design of reactor is different to Chernobyl. Despite the far better safety features it does appear that caesium has leaked from the plant and residents are being supplied with iodine tablets to counter the effects so we will just have to wait and see what is actually happening.

Fingers crossed that it is all ok and at least this time there is honest information rather than anything being covered up.

Reaper

If anybody wants proper details on the ongoing nuclear power incident I suggest you try this New Scientist news page as a source rather than the usual run of brainless journalists. They are a lot more likely to get their facts straight. Free to view currently though it may switch to subscribers only at some point.

JamesU

Reaper wrote: »

If anybody wants proper details on the ongoing nuclear power incident I suggest you try this New Scientist news page as a source rather than the usual run of brainless journalists.

BBC website this morning, clicked and listened to discussion following the explosion. BBC journalist talking to a nuclear plant expert (exact words):

"Presumably on a plant like that an explosion is something you want to avoid?"

JamesU

6022tivo

I was looking at Japanese construction shares by 11am on Friday...

Insensitive maybe, but hey, why not..