Abe falls short of supermajority – and that’s good

The Japanese stock market greeted Sunday’s triumph for Shinzo Abe’s Liberal Democratic Party in the upper house of the Diet with indifference, as the Nikkei 225 futures index fell 2.6% in the first 12 minutes of trading yesterday.

Who knows what drives markets day to day Expectations of an LDP victory were probably baked in. What matters is whether Abe can deliver on fiscal consolidation and industrial restructuring the so-called second and third arrows of Abenomics.

If his party had been able to secure a supermajority in both houses of the Diet, the LDP would have been in a position to ram through all kinds of reform...