Bread and circuses. Bonds and bad hair days.

Question from earlier this week: Will the debt-ceiling circus in Washington trigger a crisis that might stop the flow of federal money to Saipan?

Answer: I’m not a political odds maker, but the markets sure are. And debt (bond) markets don’t seem troubled by the circus. Based on that, I’d say everything’s OK for the immediate future. Default in August? Seems mighty unlikely. Besides, when is the last time you’ve heard of a government putting itself out of business?

Of course, markets can change their minds. That’s what markets are, I suppose, a formal mechanism of inter-meshing mind-changing.

But, for now: Let the good times roll. Uncle Sugar isn’t going to snap his wallet shut and tell Saipan, “Get a job, dude, you’re on your own.” Ain’t gonna’ happen. So don’t worry.

However, beyond the immediate circus, the U.S. debt situation really is a mighty zany gig, and there are troubles lurking in the future. I think I first mentioned the debt monster in this column over six years ago. It’s not like it takes a genius to see the obvious, but, well, there you have it.

So this week’s political Kabuki show in Washington isn’t a “crisis.” Instead, it’s just the nature of decline in mature economies that lose their vigor. I guess the best word is “decay,” not “crisis.” And the nature of decay is that once it starts, it just keeps on going. All the drama about reversing the process is just that: drama.

But anything beyond the immediate U.S. fiscal situation is not of interest to most folks on Saipan, so let’s not worry about it today.

Meanwhile, may I mention one thing this little sideshow did? The calliope drowned out some real news. As the people enjoy their bread and their circus, the heavies are quietly placing their bets, and just by chance I caught a humdinger of a story on Bloomberg. Here it is: General Electric, the world’s largest maker of medical-imaging machines, is moving its imaging headquarters out of the U.S.

Where to? China.

This is no pipsqueak move. Medical imaging is a huge deal, part of the very cutting edge (well, more to the point, non-cutting, I suppose) of advanced medicine. Want to talk technological marvels? This is it, sort of the best flavor of science-fiction that really helps people.

So here’s a thought: As a counterpoint to decay in certain Western venues, it would be mondo cool if industrial Asia goes on a biotech bender and starts curing serious diseases; cancer, diabetes, and stuff like that. I don’t know if it’s a realistic thing to expect. But it’s nice to think about. I guess we’ll just have to wait and see. But for all the efforts various nations put into building their global images, I think making a major medical breakthrough would be a powerful way to build a good image. The GE gig has got me thinking about that kind of stuff, as more and more talent is attracted to Asia.

Moving from breakthroughs to just plain breaking, here’s an update on a little cyber-gremlin. Amidst this week’s hype and worries about debt markets, I did get more email asking why the market data page I put on my site for Saipan Tribune readers is still missing in action. Well, it’s down because it somehow got a bad hair day, mussed up from feed from a stock market widget, and I can’t figure out how to straighten it out. Doggone thing.

Which leads us back to markets, and bonds, and debt, and the world’s largest debtor, which, of course, is the U.S. I’ll be keeping an eye on this for you, so you don’t have to have a nervous breakdown from following the hype in the media, much of which is utter nonsense. I really think the O.J. Simpson trial was a higher-minded event.

If you’d like some real insights into markets, then just walk around Garapan and talk to a vacationing Japanese housewife. I’ve been told, but haven’t yet verified, that Japanese households hold something like U.S. $11 trillion in liquid assets, and these assets are typically managed by the wives. They’re a major force in financial markets now. I’ll pass along the information if and when I get some more facts on this topic.

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