By the time you read this, the situation on the ground with regards to the Tokyo Olympics will have changed from when this was written. In fact, by the time you finish reading this, the story will have evolved from when you started reading. This is the dynamic nature of occurrences when conflicting incompatibilities are unnaturally forced together - the predictably unpredictable happens.
Amidst the sea of unknowns, here’s a ray of certainty: the Tokyo “2020” Olympics, as it’s colloquially known, will be the worst Olympics that any of us have seen thus far in our lives. Yes, I know that sounds like purely subjective conjecture at best - after all, “good/bad” for who? How do you even define what makes for a “good/bad” Olympics? And how can such a claim be made before it’s even begun? The three respective answers are:
• Bad for every individual and party, including the athletes, delegations, IOC (International Olympic Committee ← remember this acronym, will get to this key protagonist and despicable organization later), the corporate sponsors, the Tokyo Metropolitan area, the citizens and residents of the host city and Japan, and frankly the citizens of the world at large.
• “Bad” is defined as the world (let alone the event and legacy of the Olympics) being far worse off because it happened, and would be far better off if abandoned.
• As for the third answer, the remainder of this article will explain in depth why the decision to go forward with Tokyo 2020 next week has already sealed its destiny to be a predetermined major error in judgement, with spillover effects at a potentially disastrous scale. And to be clear, do not read “error in judgement” as a “mistake.” A mistake implies incompetence but not necessarily malicious intent. There seems to only be nefarious intent with all things Tokyo 2020 - deception, cover up, image perception, back-room exploitation, pushing risk off onto each other, systematic scandal and a relentless drive to advance self interests at any cost, even if that means Tokyo becomes Wuhan 2.0 and we voluntarily hand COVID a second wind. I had not realized just how atrociously ugly the seemingly wholesome Olympics can get, but it is on clear display now. And apparently, I am not alone with my sentiment - Paris '24, Los Angeles '28, and what appears to soon be Brisbane, Australia 2032 (to be confirmed in the next few days) - there were no bids outside of Brisbane, and absolutely no bids to host the Olympics thereafter. And for good reason. Who would want this high risk, negative reward event in a sudden secular trend shift away from travel (or travel uncertainty at the very least looking a decade and a half out)?
Please note that what you are about to read may seem controversial, overblown, an attempt at fear mongering, or perhaps just untrue. In reality, none of these apply - this is all common consensus on the ground here. So if you find yourself in some shade of disbelief and denial, it means you haven’t been paying attention to the biggest risk in plain sight on the immediate horizon that is being completely overlooked. It is of my strong opinion, along with anywhere from 60% to 99% of those surveyed, that the Tokyo Olympics 2020 should not be held starting next week.
Here is a quick rundown of some background facts, figures and themes that you need to know.
Japan’s severe and unrecognized mishandling of COVID
Does anybody think that a country who just put their host city under a pandemic state of emergency through the entire Olympics and has instituted a foreigner ban is in any position to host 100,000 foreigners from 200 countries..???
I wrote about the conscious and purposeful foot dragging that the Japanese government has been doing since the start of COVID in part 1 of my previous piece- Japan: The World’s Biggest COVID Failure. Not only is Japan dragging its feet and costing lives, again, very much consciously and on purpose, but they are cooking their books. Japan does not report anywhere near the real COVID numbers, and anyone who just looks at a list of countries and sees Japan's figures with one or two less 0's missing, while all of their peers are in the tens of thousands, yes Japan is cooking its COVID books.
And then there's the matter of vaccines. I would say let's discuss vaccines and Japan (or lack thereof), but instead, just look at this moving chart of G7 peers and population % vaccinated:
The first COVID vaccine was administered in early December 2020. From that very moment forward, billions of shots have been distributed. The G7 is by and large halfway fully vaccinated, some above and some below the 50% of population mark. Japan is currently around 15%, and was still in single digits as recently as last week, or well within one month of hosting the Olympics. If you look at the moving chart above, you'll see that Japan doesn't even enter the picture until months had passed (Japan approved J&J in Feb, and approved Moderna in late May). Half a year after mass vaccinations, and months after America couldn't even give the vaccine away anymore, Japan was (and still very much is) dragging its feet. Prime Minister Suga had a target timeline of full vaccinations set at November 2021, and I am not kidding in wondering if that timeline is factoring in and "aided" by the shrinking denominator to account for all the deaths that will occur until November - almost one full year after that first shot heard (almost) round the world.
Meanwhile, many hundreds of Japan's companies and universities, who were quite literally very sick of waiting for the government to act as if this were the emergency that it is, have taken matters into their own hands by vaccinating their own respective employees and students. Top universities such as Keio University, as well as major corporates from the tech vol trading hedge fund SoftBank Group, to even the most domestic corporate cultured trading houses such as Itochu Corp have had enough of the government’s purposeful stalling, and began inoculating their own. That is until the government stopped approving licenses to do so. Again, the consistent, very conscious, purposeful stalling of saving lives.
Japan- The Enron of COVID
Before we get to WHY Japan is consciously allowing the world's most at-risk population die, particularly when there had been a vaccine for months, lets see HOW Japan, second largest democratic economy in the world, was able to get away with having worse COVID response than India or Brazil. The HOW is very simple - Japan just doesn't test.
Much like President Trump would say - if you don't test, you don't have COVID numbers on record (and its true).
If I were back in my hometown of NY, I could get vaccinated at Yankee stadium for free, and perhaps it might come with a free hot dog. In Japan, where universal health care means that if I need an appendix removed, that would cost me $10 out of pocket- but in order for me to take a PCR test, I have to pay. Ridiculous, right? It gets better. How much do I have to pay? I have to pay $250 out of pocket for a PCR test. And if I want an official piece of paper that says I was PCR tested, that would be $350. By not testing, you are cooking your books - as those are obviously not your real daily case counts. And COVID death counts can only come from positive COVID cases. So- if you don't want a bunch of dead COVID stats, just don't "create" them in the first place. The general quantity of deaths in Japan is unclear, but several sources of data suggests general deaths had increased by 7x or 8x YoY in 2020, by the way. But these "weren't COVID deaths." Lot of slipping on banana peels and what not I guess. Japan funeral homes businesses cannot accept any more business - neither can corpse hotels (what the hell is a corpse hotel? Much like kyabakura, its a biz model that’s not only specific to Japan, but thriving).
Doesn't anyone find it incredibly shady how when COVID was blowing up in Europe, UK, US, Central and South America, cross-Asia, everywhere had tens and hundreds of thousands of cases, while Japan had like 800??
Japan is the Enron of COVID. This is critically important to know. Because in a week and a half, delegations from 200 nations in every corner of the planet will congregate for the first time since the pandemic started - at the Enron of COVID. And somehow, nobody is concerned with this? Athletes - do you not find it strange how vaccines, tests, social distancing measures and all of that are being forced upon you with abundance, yet Japan's own citizens are unable to get vaccinated at a G7 rate? What Japan is doing at Olympic Village is putting on display its capabilities to exercise if it so chooses to. So instead of vaccinating your own citizens, you're vaccinating a bunch of foreigners, who you have a foreigner BAN on as it is.
Prime Minister Suga, Governor Yuriko Koike, you have a lot to answer for. Shinzo Abe, you too. Nice timing with your duck out.
When the Enron of COVID hosts the Olympics (during COVID) - IOC & the Money
So, meet this asshole ↓
...goes by the name of Thomas Bach. He is the president of IOC (International Olympic Committee). And as you can see by his first press conference after landing in Japan just the other day (following months of insisting the Olympics WILL go on, come hell or high water), he truly has the Japanese / host cities at top of mind, and doesn't just see them as shell cities to extort money from. Thats sarcasm, in case not obvious. (By the way, when he made this impassioned speech above for "most importantly, the Chinese people" - the Japanese translator did not pick it up/say it. Its gone viral nonetheless - Japan doesn't ever hate anyone in particular as a group, but this guy, he's hated).
The IOC is a scummy organization of gangster exploitation, leveraging the allure of the olympics, and who's business model isn't exactly to screw the host country over all the time- but basically 100% of the time in the last several olympics all the way back to LA in the 1990s, the host country always ends up spending more than 2x the original budget. Sochi, Russia was a particularly bad case, where the host city lost somewhere around -$50bn. And why does this happen? Several factors, but aside from the grifting architect and what have you - the IOC makes demands and requirements for facilities to be built. In fact, the IOC has say over everything. The contracts that are signed between the host city and the IOC are horrendously lopsided, giving IOC all of the power and leverage, while bearing none of the infrastructure cost themselves. So IOC can (and will) run up the bill on a host city, demanding this or that facility to be built as more and more sports get added to the summer olympics in particular, and the host city will oblige.
So here is how IOC has run up the bill on Tokyo:
• First, the process of bidding cost Tokyo $115 million, for which Tokyo did not win. Tokyo tried again, adding an additional +$75 million, and that did the trick, Tokyo spent nearly $200mn just to win the 2020 Summer Olympics bid itself in 2013. Note that 2013 was also the launch of Abenomics, at which point they were supposed to hit "2% price stability (inflation) in 2 years" - and then by 2020, would be deep into their virtuous cycle of growth. Yeah that didn't happen, but the 2013 Abenomics timing matters.
• Upon winning the bid in '13, the initial budget for Tokyo 2020 was $7bn.
• Today, Japanese government claims the cost is now $15bn. The range of estimates by third parties goes from $20bn to upwards of $35bn. A far cry from that original $7bn budget. How did it go from $7bn → $20bn or $30bn?
• IOC requires building of Olympic Village to house the athletes, an Olympic Stadium, security, maintenance etc - these are all demands that by contract, the host city will fulfill.
• In 2013, then incoming BOJ Gov Kuroda shot off a massive QQE bazooka and weakened the yen from 80 to 100, then to 125. A depreciating yen meant their raw material imports for building and construction saw FX adjusted costs surge in JPY terms (up to +50% on FX move alone)- hence the significance of the Abenomics start timing.
• Then in early 2020, construction was done on time, everything was set for the Olympics. And COVID happens. The delay costs meant renting for an unexpected year instead of a month, along with opportunity costs, and COVID delay + COVID measures themselves tack on another +$3bn.
All of this adds up. And now that no foreigners are allowed, and no local fans are allowed, Tokyo just bought a 68,000 seat stadium that will not generate one yen of revenue back. Tokyo just blew $15bn - $30bn.
Now, one can say - well why the hell don't you just wait even a month longer, so that you can at least fill half the stadium rather than a completely empty one and make some of your cost back??? Can't do that, not unless the IOC gives the green light to do so under contract.
IOC itself makes its money by selling broadcasting rights. In 2016, Thomas Bach and IOC generated $5.7bn revenues, 70% of which came from broadcasting rights. And NBC Universal (CMCSA) signed a $7bn deal for exclusive rights to broadcast the Olympics from 2021 -2032. Bach & IOC - they don't care if poor stupid Tokyo can or can't fill physical seats, they're in the broadcasting game. And if they just upped the broadcasting rights price to Comcast by $2bn starting this year, then dammit they will start this year.
Thomas Bach Is the one person who can cancel, or postpone the Olympics. He can also bow and tell PM Suga to kindly fuck off if Suga were to beg him to postpone or cancel the event, all because of that exploitative contract. This is why Bach doesn't care one bit about COVID- the show must go on, even in an empty stadium that he ordered Tokyo to build- as long as its broadcasting. If Bach cancels, the NBC bill falls on him, so obviously he will not cancel the olympics under any circumstances. If PM Suga cancels, then Tokyo foots the NBC bill. And this is supposedly why Suga is so set on having the Olympics.
BUT - I have my reservations that its about the money to reimburse NBC Universal. $7bn over the next 4 Olympics is a little under $2bn that Tokyo would have to pay NBC if they cancel. The original budget for Tokyo Olympics was $7bn, now it can be 5x more at $30bn. What's another $2bn to get this Thomas Bach douchepickle off your back? BOJ will just end up paying for all of this anyway.
So why is Suga so insistent on holding these Olympics, and to hold them right now as COVID is intensifying worldwide? Some theorize motives tied to an election in October, and that he may be trying to coast off of post Olympic momentum, but I don't believe he's that stupid. Post Olympics is exactly when the worst of the consequences will surface (Suga may or may not know that), but if he wanted to ride off Olympic momentum, then kick the Olympics back to October (when the weather is the best in the year), and hold the election during the Olympics with nationalist pride running through everyones veins.
And Suga's approval rating is currently at 38% all time lows (seems too high to me). The only thing that polls lower than Suga are the Olympics themselves.
↑ This is an aggregate poll from a few sources (GS).
I saw a poll the other day, which gave the following results:
• Government coronavirus handling disapproval: 71%
• Most recent state of emergency: 77% said the emergency extension was appropriate
and then this...
62% Olympics should be postponed or cancelled.
37% Olympics should be held this summer with limited or no spectators.
1% Olympics should go on as usual
Wow. Rounding errors- think we can call that 100% do not want the Olympics as usual. More than ¾ of people think the state of emergency extension was the right call. That’s just a bit shy of the inverse of % of fully vaccinated from earlier. Which also matches up with Suga's approval rating.
The Japanese are NOT excited about the Olympics. People do not want the Olympics in Tokyo, period. Tens of thousands of Olympics volunteers are voluntarily pulling out. Japan is not vaccinated - Japan is dying. Tokyo doesn't want a sample of every country to swarm in, it wants a fucking vaccinated population, or at least a government who acts like every other government in the world and is doing everything in its power to protect its country. The delta variant is in Japan. And I'm not going to pretend to be a virologist (like every financial analyst played in early 2020), but the Olympic Village is a Petri dish for an "Olympic Variant" - when you merge every country in the world together. So far, 30 athletes/coaches/delegation members who supposedly were vaccinated before coming to Japan have tested COVID positive. The delegation from India has to face extra precautions, and now there are accusations of racist policies being made. A few Brits who just arrived got busted with cocaine (that one has nothing to do with anything but... was in the news with the same urgency as Olympics matters so…)
The corporate sponsors are understandably pissed off and getting impatient with a back and forth fumbling government response. 41 Japanese companies with a total $2bn sponsorship events, 14 have pulled out as of yesterday. Voices like SoftBank CEO Masa Son and Rakuten CEO Mikitani have been very vocally against holding the Olympics in Tokyo. You know how DM economies are showing ridiculous YoY growth figures off of the COVID cliff dive base effects (like US +30% and what not) before “leveling off” to 4-6% and now the Fed facing 2 consecutive readings of “transitory“ 5% CPI? What a nice problem to have. Here’s what COVID did for Japan “inflation“ - negative for 8 consecutive quarters ↓
Tankan business sentiment survey shows optimism for large manufacturers (automobiles, chemical exporters - supply chain disrupted demand advantaged), but the latest Tankan survey shows the services sector down - due to COVID, and head-fake corporate vaccinations. Just look at NKY top in Feb as SPX and Eurostoxx hit all time highs - EU & UK are taking ehat would otherwise be Japan inflows and rightfully so.
The athletes cannot possibly be having fun. They're basically in a prison with very strict rules. No friends or family, they're all at home, wherever home is. They are not allowed out into the public. No media local media interaction. They have one cafeteria where you watch a board and wait for your number to flash, like some arrivals/departures board at the airport. You eat in a plexiglass cubicle of what looks like a high school lunchroom (but everyone the athlete). No loud talking. No yelling. No laughing. And good god no cheering.
So, imagine being an Olympian, forgoing a “normal life” for training and competing at the highest levels, defying odds to qualify as your country’s representative, sprinting / swimming / rowing your way across the finish line by a half-inch for the gold - greeted by a third filled stadium of dead silent, masked Japanese fans (if they change their minds again and allow partial attendance, would presumably just be fans of team Japan only) - not even the crickets are allowed to chirp. Your family and loved ones who have supported your journey to making history? That requires your coach to hand you an iPad connected to a Zoom call back home. This is not theoretical - this is reality, notwithstanding the long list of the other physical, mental, emotional, economic and political damage that will likely unfold. And within 48 hours of your event finishing- government kicks you the hell out of the country- thanks for playing. Which means if your sport is one of the earlier ones, no closing ceremony for you. If nothing else but the aforementioned scenario happens (and it will indeed play out as such), that makes for the worst real-time Olympics experience for the athletes ever. This is not what anybody devoting their lives to represent their counties dream of. Still, if given the choice between this type of Olympics or no Olympics whatsoever, it’s pretty obvious how the world’s most determined competitors will answer. But if you can find some way to even get a drop of disappointment or emptiness for a gold medalist - then you indeed have achieved worst Olympics ever status.
Then they go home, just when delta variant happens to be spreading. Whether or not they brought it from Japan, or it was already in their home country, the days after the Olympics will be the real test for Japan, as everyone around the world turns their eyes back east and Tokyo becomes Wuhan 2.0. Whether it is, or it is not, all they'll have to do is look at Japan's third world level vaccination rate, and that's all that the world will need to despise Japan. And rightfully so. Even if Japan tests every single visitor at the gate before boarding and records negative for proof to the world that they were clean when they left Japan- that’s seriously the delta hedge? Ever heard of - fake news? Or in Japan’s case with their stellar history of COVID testing - real lies.
One notable development - US First Lady Jill Biden announced to attend Tokyo Olympics, for what insane reason I have no clue. This is an incredibly stupid snd unnecessary move. There is zero upside to attend (with all due respect the athletes will be fine / not even notice you’re there, First Lady Biden). However, her attendance is the White House signing off on this disease dynamite powder keg. So should the world get a real second COVID wave, President Biden - you and your wife just squandered any credibility and negated any effective COVID-fix policy implemented thus far. Why Suga wasn’t grilled at G7 last month by Biden, Merkel, Macron, Trudeau, Draghi (..maybe not Boris) about hosting the Olympics - I don’t know. Why Jill Biden is proactively endorsing catastrophe is beyond me.
Tokyo 2020 will be a disaster. The only question is to what degree. Maybe this current "reopen" was just the "between wave 1 and 2" - and this idiotic unnecessary Tokyo super spreader event ushers in wave 2. Who knows. But for whatever reason, nobody is paying nearly enough attention to this risk. This is not a black swan. Don't get blindsided.
As far as markets are concerned, there will be a time to go Long NKY. Unlike US and Europe, Japan has yet to price in a reopen (because it has yet to have a reopen). And since vaccines are so delayed, by the time the US and Europe reopen trade has Long fizzled, Japan will get going, and NKY outperforms. But first let Japan re-COVID the planet before going Long NKY.
Some recent quotes:
•(the following statements from Prime Minister Suga are from the same press conference)
SUGA: GROWING CORONAVIRUS INFECTIONS IN TOKYO COULD EXPAND TO THE REST OF THE COUNTRY
SUGA: WILL THOROUGHLY PREVENT OLYMPIC ATHLETES FROM BRINGING CORONAVIRUS INTO JAPAN July 8, 2021 -Reuters
•Thomas Bach, IOC President:
”zero percent chance“ for Japanese citizens to contract COVID from Olympics in response to +4 more positive cases among athletes and delegations now totaling 30 - most of whom arrived testing positive. Imported COVID.
Read the following 3 headlines- that’s all you need to know about this guy:
↑ a guy who clearly doesn’t give a shit about anything but his personal agenda.
↑ best ever prepared… compared to what? All the other COVID Olympic host cities throughout history?? Agreed Japan is the best ever prepared. It’s also the worst ever prepared. It’s the only one that’s ever had to “prepare” - moron.
IOC's Bach says Tokyo Olympic cancellation not option despite COVID
↑ Why the need to negate this “non-option” if it weren't an option? And I thought Tokyo was the “best-ever prepared” - that’s the PR line to use for why no need to cancel vs a gun to the head approach (click) “this ain’t no OPTION….”
•Shigeru Omi, head of the Japanese government's coronavirus advisory panel (Japan’s Dr. Anthony Fauci) says holding the games under a state of emergency "must definitely be avoided."
•Kaori Yamaguchi, a Japanese Olympic Committee executive board member and former judoka, says the Tokyo Olympics "have already lost meaning and are being held just for the sake of them," but that she believes it is too late to cancel. "require too much energy to make and follow through with such a decision." With public opinion strongly against the games but the International Olympic Committee determined to go ahead, she argues Japan has been "cornered" and is "damned if we do, and damned if we do not."
One Last thing- Condoms
One particular COVID prevention measure being implemented by Japan that I want to point out - no condoms. Apparently, during each Olympics, free condoms are given out to athletes. But not for Tokyo 2020 - as condoms = no social distancing = COVID. Condoms. Who would’ve thought- this whole COVID thing could have been completely mitigated from the start if governments and convenience stores worldwide had just burned their condom inventory, and then instead of bailing out every business and individual, we could have just supported those who work in the condom industry. And yes, the no condoms due to COVID thing is very much a real thing. Sorry, athletes - welcome to Japan. → Please take Tokyo Olympics condoms back to your home country and use them there, organizers say