The Hirohito Moment: 1

This was inspired by the concept of a Minsky Moment.

A Minsky moment is a situation in which investors who have borrowed too much are forced to sell even good assets to pay back their loans. In economic terms, it is the point in a credit cycle or business cycle when investors have cash flow problems due to spiraling debt they have incurred in order to finance speculative investments. At this point, a major selloff begins due to the fact that no counterparty can be found to bid at the high asking prices previously quoted, leading to a sudden and precipitous collapse in market clearing asset prices and a sharp drop in market liquidity.

Essentially, a Minsky moment is reached when the the major players have no option but to accept that the ponzi scheme has collapsed. Until that moment, many can carry on by deluding themselves with fictional numbers and other lies. But after that moment, there is an acceptance that the old ways are no longer viable and that the underlying system has imploded.

The concept of a “Hirohito Moment” is similar except that it applies to socio-cultural attitudes and behaviors of a nation or racial/ethnic group.

Hirohito was the Emperor of Japan during its worst imperial excess. Though he was not the guy in charge of the day-to-day workings of Japan, he had the ultimate authority and the respect of his people. Therefore he also had the ultimate responsibility and authority to surrender.

While Japan had never surrendered until the end of WW2, the reverses in the Pacific, SE Asia and the Ariel bombing of Japan cumulating in the use of nuclear weapons left it with no option but to surrender. While there was disagreement about surrendering in his council, the pro-surrender side prevailed at the end- because the option was so much worser.

But now the war has lasted for nearly four years. Despite the best that has been done by everyone–the gallant fighting of our military and naval forces, the diligence and assiduity of out servants of the State and the devoted service of our 100,000,000 people–the war situation has developed not necessarily to Japan’s advantage, while the general trends of the world have all turned against her interest. Moreover, the enemy has begun to employ a new and most cruel bomb, the power of which to do damage is, indeed, incalculable, taking the toll of many innocent lives. Should we continue to fight, it would not only result in an ultimate collapse and obliteration of the Japanese nation, but also it would lead to the total extinction of human civilization.

The white west is starting to experience the set of conditions that will lead to its “Hirohito Moment”. It no longer has the technological edge, ability to produce, asymmetry of information or ANY of the traditional advantages that allowed it the dominate over “others”. Nor does it have the ability to regain its old position.

However these changes have occurred very quickly, mostly in the last 30 years and many in the west (old and young) still believe that they live in 1910- the peak of the western advantage over the “others”. Their behavior and attitudes have not adapted to the new reality. All complex systems have some inertia, but they all have to adapt to the new realities after the gas tank is empty. It is not possible to run on fumes forever.

I suspect that the “Hirohito Moment” for the west will be more individual, than collective. It will also likely occur after a series of unexpected events force people to acknowledge that the old reality is dead. I can only speculate on what such events will be- but my money is on secondary/tertiary economic shocks. More in a future part of this series.

Comments?

  1. the dude
    September 16, 2010 at 8:05 pm

    What exactly do you mean by those shocks? Adjusting claims to reality, living by their means?

  2. January 1, 2013 at 6:02 am

    Femynyzm’s Hirohito Moment:

  1. September 19, 2010 at 2:29 am

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