ROOM AT THE INN

The flight to safer ground owing in part to negative zero interest rates is starting to bite the Japanese economy where none of us want to be bitten--in the pocket book.

For those willing to detour for a moment from their linear penchant of thinking that means the Japanese economy. Anyone who's been paying even a modicum of attention knows the yen, like it's nation's well-known symbol, has been rising.

Japanese exports just got more expensive and so did the Japanese tourism business, among other things. Measured against the dollar it's now reached a level, 115 yesterday, of strength not seen since 2014 as the flight to higher ground threatens the best laid plain plans of Japanese central bankers and bureaucrats.

Japan is an island. Islands by definition depend on outside sources for survival. Corporate earnings are at stake here and that means less possibility for higher wages and more consumer spending. As they say: No good deed goes unpunished. Nor does any lousy, ill-conceived bureaucratic calculation.

The headwinds facing negative interest rates are well-known, but ironically the list seems to grow with each passing day. Real wages in Japan last year were down for the fourth straight year. And what so far was suppose to be a positive from negative rates has turned out to be anything but.

The shorts who were expecting a weaker yen should be covering about now, pushing the currency even  higher up the currency totem pole. One Japanese economist was quoted recently as saying that BOJ Governor Haruhiko Kuroda's "is starting to lose his divine powers."

There's still room at the inn. We'll soon know more about some other central bankers checking in there.