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Time Warner’s one-two megamerger punch, first with America Online then with British music giant EMI Group, followed last week by shares of Yahoo Japan Corp. exceeding 100 million yen, sent many investors and observers searching for a psychological safety blanket.

Surely there must be an escape-hatch to this madness of inflated dot-com stocks, and the ripples of excess they create with each new transaction.

It was bad enough when the syndrome seemed rampant mainly in the United States. Now it has extended to Asia with the expectation of many that Internet globalization may spread faster and even more profitably over here than back there.

In times of such confusion and contradictions, a good place to turn is the writing of Tokyo-based economics commentator Eamonn Fingleton, whose analyses make maverick and enfant terrible Paul Krugman sound like those of a button-down conservative.

After reading Fingleton’s new book “In Praise of Hard Industries: Why Manufacturing, Not The Information Economy, Is The Key to Future Prosperity,” (Houghton Mifflin Company, New York, 1999, 235 pp., $26) in a single sitting, I could at least get a good night’s sleep.

Fingleton’s assessment in a nutshell is that manufacturing, particularly at its sophisticated levels, beats postindustrialism, mainly the amorphous information-service industry, hands down.

The news from Time Warner, AOL, EMI and Yahoo Japan notwithstanding, Fingleton says that over the long haul, “postindustrialism should not be embraced blindly just because it is fashionable, nor should nations lightly allow their manufacturing prowess to drain away.”

He pinpoints the Japanese electronics industry, which has moved into making the advanced materials and production machinery used throughout the world’s electronics industry. “Among other nations that have been similarly successful in advancing to ever more sophisticated levels of manufacturing are Germany, Switzerland and Singapore. These nations, like Japan, have generally outpaced the United States economically over the long run.”

Fingleton sticks to his intellectual guns despite popularly held indicators to the contrary. You’ve got to admire someone who comes out with a book like Fingleton’s first: “Blindside: Why Japan Is Still on Track to Overtake the U.S. by the Year 2000.”

Over lunch, Fingleton was asked if he would like to revise his “Blindside” thesis due to the fact that it is already 2000 and there is scant evidence that Japan is about to “overtake” the U.S.

“Not at all,” he said, his jaw set with the determination befitting a son of Ireland. “My basic premise, if anything, has been reinforced.”

Fingleton is to be admired much in the same way that Harvard Professor Ezra Vogel deserves respect for his 1979 book “Japan As No. 1.” Not long after Vogel’s book was published, the Japanese economic bubble burst with an intensity that nearly damaged various earthquake gauges.

Vogel’s book title, like Fingleton’s, is part contrarian hype. But as Vogel will tell you, what he meant was that there is much in the Japanese system and approach that is “No. l.”

Fingleton can make the same claim, although there is plenty going on across the street.

Japan’s big three Internet stocks recently rose at rates that Fortune magazine’s Jim Rohwer says “made most American Internet plays look like utilities.” Cited, through yearend, were Yahoo Japan’s 4,206 percent rise, Softbank (now Japan’s fifth-biggest company) surge by more than 1,250 percent and Hikari Tsushin jumped by more than 2,900 percent. The latter is a 4-year-old mobile phone and Internet investment firm that is now larger than Honda or Matsushita.

In January, the Yahoo Japan stock rise to over 100 million yen, making it the first issue to break that mark in the history of Japan’s stock market.

All of these seem drastically overvalued not just to bystanders but to many veteran financial experts.

What should not be undervalued is the ability of commentators like Fingleton and Vogel to think beyond the margins of conformity.

In a time of both misinformation and too much information, quality journalism is more crucial than ever.
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