U.S. markets and the world

If share prices in New York, which have sucked in money from all over the world like a black hole, should plummet, the effect of the plunge will be felt worldwide, not just in the United States.

It would be better for the Federal Reserve Board to adopt a somewhat tighter monetary policy. Considering the slowing growth of the U.S. economy, the chaos in Asian economies and the approaching congressional elections in the United States this fall, it may be difficult to press a big increase in interest rates. Still, some departure from the present neutralist approach is necessary.

Personal investment in the United States has gained significantly, not only in stock values, but property values as well. There are hints of a renewal of property inflation, which was also seen in Japan as the asset-inflation bubble expanded. The Bank of Japan was late in taking remedial action here because it was distracted by price stability. That lapse should not be forgotten.

-- Asahi Shimbun, Tokyo