Tokyo. Japanese Economics Minister Akira Amari said on Friday if recent stock market gains are signs of a small bubble he would welcome this as it’s still manageable and signals growth in business activity.

Amari, who spoke after the Nikkei stock average briefly hit a 15-year high, said the rise reflects expectations that corporate earnings will improve further and noted that the government needs to put policies in place to ensure this happens.

It is unusual for a policymaker to speak approvingly of an asset price bubble as the danger of it popping and wreaking economic havoc is well documented.

However, Japanese Prime Minister Shinzo Abe’s government has placed a lot of emphasis on lifting stock prices to increase returns for individual investors in the hope that they spend some of this money and revive the economy.

“The larger a bubble becomes, the harder it is to control,” Amari told reporters.

“A small bubble is something that can be contained. If recent stock gains are signs of a mini-bubble, this is something I would welcome.”

Japan’s Nikkei share average briefly rose above 20,000 for the first time in 15 years earlier on Friday, supported by a positive tone in global equity markets, but the benchmark index quickly erased those gains to trade slightly lower.

Japanese shares have been steadily rising since late last year despite a largely mixed bag of economic data, causing some investors and analysts to question the sustainability of these gains.

Since coming to power in December 2012, Prime Minister Shinzo Abe has pursued a mix of economic reforms and aggressive monetary easing to revitalize growth and pull the economy out of 15 years of grinding deflation.

Abe’s government has said that households and corporations have been hoarding cash for too long and they need to be encouraged to invest in riskier assets, like stocks.

However, Abe’s critics say the prime minister is trying to recreate Japan’s late 80s bubble economy and that stock market gains only benefit wealthy individual investors.

Reuters

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Tokyo.  Japan and North Korea could resume talks as early as this month over an investigation North Korea is conducting into the fate of Japanese citizens it kidnapped decades ago, the Nikkei newspaper reported on Saturday.

There was informal contact between Japanese and North Korean diplomats in China in late February, and the two sides agreed to hold a meeting about the investigation in Chinasometime late March or early April, the Nikkei said without citing sources.

Foreign ministry officials were unavailable for comment.

If the talks do take place they would be the first official contact since Japan sent a diplomatic mission to Pyongyang in October only to be disappointed to learn that North Korea had no new information about abductees.

North Korea admitted in 2002 to kidnapping 13 Japanese citizens, and five of those abductees and their families later returned to Japan. North Korea said that the remaining eight were dead and that the issue was closed, but Japan has been pressing for more information.

The North promised to reopen the investigation in 2008, but never followed through.

When North Korea agreed last year in May to reopen an investigation into the abductees Japan responded by easing some sanctions in a sign the often fractious relationship between the two countries could improve.

Reuters

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