VZCZCXRO6833
PP RUEHFK RUEHKSO RUEHNAG RUEHNH
DE RUEHKO #0268 0320710
ZNR UUUUU ZZH
P 010710Z FEB 08
FM AMEMBASSY TOKYO
TO RUEHC/SECSTATE WASHDC PRIORITY 1441
RUEKJCS/SECDEF WASHDC PRIORITY
RUCPDOC/USDOC WASHDC PRIORITY
RUEATRS/DEPT OF TREASURY WASHINGTON DC PRIORITY
RUYNAAC/COMNAVFORJAPAN YOKOSUKA JA PRIORITY
RHHMUNA/HQ USPACOM HONOLULU HI PRIORITY
RHHMHBA/COMPACFLT PEARL HARBOR HI//N541// PRIORITY
RHMFIUU/HQ PACAF HICKAM AFB HI//CC/PA// PRIORITY
RUHBANB/OKINAWA FLD OFC US FORCES JAPAN CP BUTLER JA PRIORITY
RHMFIUU/USFJ PRIORITY
INFO RUEHFK/AMCONSUL FUKUOKA 5859
RUEHNH/AMCONSUL NAHA 8255
RUEHNAG/AMCONSUL NAGOYA 4489
RUEHKSO/AMCONSUL SAPPORO 6467
RUEHOK/AMCONSUL OSAKA KOBE 9526
RUEHBJ/AMEMBASSY BEIJING 1456
RUEHMO/AMEMBASSY MOSCOW 2102
RUEHUL/AMEMBASSY SEOUL 7519
RUCNDT/USMISSION USUN NEW YORK 8153
RHEHAAA/NSC WASHDC
UNCLAS TOKYO 000268
SIPDIS
SIPDIS
STATE FOR I/RF, PA/PR/FPC/W, IIP/G/EA, EAP/PD, R/MR,
EAP/J, EAP/P, PM;
USTR FOR PUBLIC AFFAIRS OFFICE;
TREASURY FOR OASIA/IMI;
SECDEF FOR OASD/PA;
CP BUTLER OKINAWA FOR AREA FIELD OFFICE;
PACOM HONOLULU FOR PUBLIC DIPLOMACY ADVISOR
E.O. 12958: N/A
TAGS: OIIP KMDR KPAO JA
SUBJECT: TOKYO MEDIA REACTION - GLOBAL ECONOMY
1. LEAD STORIES: Most Friday morning papers gave
prominent front-page play to a growing boycott across
Japan of frozen food from China in response to an
increase in the number of consumers who complained of
food poisoning after eating frozen Chinese-made
dumplings contaminated with an agricultural chemical.
2. "Explore Path Toward Enhanced Coordination" The
liberal Tokyo Shimbun argued in an editorial (2/1):
"The Fed's decision to additionally reduce interest
rates was a bold act that demonstrated its
determination that thorough measures will be taken if
needed.... Monetary authorities across the world are
paying close attention to developments in the financial
sector in the face of the ongoing global stock market
turmoil.... A G-7 financial ministerial will be held in
Tokyo starting on Saturday. Member states should issue
a clear message aimed at stabilizing the financial
markets."
3. "Unusual Decision to Avert Crisis" An editorial in
the top-circulation, moderate Yomiuri stated (2/1):
"The Fed has been criticized for acting too slowly on
the subprime loan crisis and the worldwide stock market
turbulence. The unusual back-to-back rate cuts signal a
clear policy shift toward prioritizing the prevention
of a recession over containing the possibility of
inflation sparked by high oil prices.... The most
worrisome thing is that there appears to be no end in
sight to the subprime loan crisis. U.S. authorities
need to mobilize all their fiscal and monetary tools,
including the injection of public funds and additional
interest rate cuts."
4. "Fed Undertakes Additional Rate Cut" The business-
oriented Nikkei editorialized (2/1): "The Fed cut
interest rates twice in just over a week. In announcing
the second rate cut, the Fed statement said: 'Financial
markets remain under considerable stress.' The Fed
acknowledged that optimism is not warranted about
financial markets despite the earlier rate cut, sharing
concerns held by market players.... Also noting that
'it will act in a timely manner as needed,' the Fed
hinted at the possibility of further cuts. It appears
to be well aware that a recession is in the offing."
SCHIEFFER