Some flash commentary from JPMorgan’s Masaaki Kanno:
Prime Minister Kan set up the emergency disaster response team and mobilized the Self defence Force. The BoJ said immediately after the earthquake that the Bank will do everything to provide ample liquidity. The BoJ announced that the Bank purchased the JPY1.8billion J-REIT today, although the bank did not clarify wher the Bank purchased J-REIT before or after the earthquake. The opposition parties sent out the statements that they will cooperate with the government on emergency measures.
Although Tokyo is more than 200 miles away from the centre of the earthquake, high rise buildings were shaken massively. I have never experienced such a large tremor in my life. The earthquake lasted more than a few minutes. Elevator service suspended automatically, and papers/ magazines on the shelves of our office fell off to the floor. As our office located at the top of the building, the tremor may have been intensified, compared to that on the ground. During the earthquake, I saw the cranes on the top of the building under construction, right next to our building, bowing like the trees in the storm. Although elevator service was resumed shortly, all the train services remain unavailable probably all night today in Tokyo. While some people left the office, going back home on foot, others are still stuck in the office. All the food and beverage at the convenience store at the basement of the building were sold off instantly.
While the earthquake’s impact on the economy remains to be seen, it appears to take time before the whole transportation and distribution system starts working normally. Spending on public works is expected to increase in coming quarters, but business activities especially in Tokoku area will be damaged. Consumers are likely to increase the inventory of food and beverage, but their arbitrary spending, such as tourism, may be reduced.
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