Let’s talk about Japan today.
1
Recently, everyone is concerned about Japan because of the sharp devaluation of the yen:
and it is a pity that it is inconvenient to go to Japan. Let’s buy and buy happily:
Because Japan insists on a loose policy, which has triggered a sharp depreciation of the yen, various articles have been published online these days.
Many wild national masters directly declared that Japan was in danger and was about to be destroyed.
It is true that there are many old and new hatreds between China and Japan, but professional analysis should not be emotional at all. It should be like a scalpel, cutting in coldly, observing and analyzing calmly and objectively.
is not suitable for grandstanding in order to cater to traffic.
2
I want to understand why Japan insists on being loose despite the global interest rate hike cycle (China tightened it early at the end of 2020). The simplest way is to listen to what others say.
htmlIn early January, Bank of Japan Governor Haruhiko Kuroda published an article on the official website of the Bank of Japan - "Thoughts of the Bank of Japan on Monetary Policy", which stated very clearly that it would insist on monetary easing and would not raise interest rates Reasons and goals.
Those who are interested can go to the Bank of Japan’s website to download and read:
https://www.boj.or.jp/announcements/press/koen_2022/data/ko220606a1.pdf
Kuroda insists on easing, for three reasons, Lao Nan simply translated Next:
. Japan’s economy has not yet recovered from the epidemic.
Compared with GDP in the first quarter of 2019, the United States +3.7%, the European Union +0.6%, and Japan -2.7%. Isn’t this data lonely if interest rates are raised?
. The depreciation of the yen has a neutral impact on trade.
The main reason for Japan’s continued foreign trade deficit is not the depreciation of the yen, but the rise in U.S. dollar-denominated commodities. The depreciation of the yen will simultaneously push up the import and export prices denominated in yen, and has a neutral impact on trade. So there is no need to raise interest rates.
. Inflation in Japan is not high.
There is huge inflation in Europe and the United States. The CPI has exceeded 8%, but in Japan it is only 2.1%. What kind of interest rate will be added to this inflation?
Therefore, Kuroda believes that Japan’s current GDP and CPI do not see any need to raise interest rates, and it must continue to be loose to support Japan’s economic activities.
Then Kuroda said a few important words:
The key will be significant wage increases and an escape from years of zero inflation in service prices.
Although the Bank of Japan has adopted large-scale monetary easing policies in the past nine years, it has failed to achieve the 2% target. The biggest reason is that the "zero inflation norm" has been extremely persistent.
The key to changing this situation is to increase wages.
Do you understand? The fundamental purpose of the Bank of Japan is to take advantage of this global inflation to force companies to raise wages, hoping to pull Japan out of the low-inflation environment it has experienced for decades.
3
Many people may not understand why the central bank forces companies to raise wages even at the risk of the yen exchange rate losing control.
You can understand it by looking at a few sets of data:
After the war, Japan completed rapid development. In the late 1990s, household income increased rapidly to nearly 600,000 yen. After that, it entered the lost 20 years. In these 20 years, Japan The family income basically fluctuates in the range of 500,000-600,000.
Is it true that the company has no money? Not really.
This is the financial report data of Toyota Motor . In the past ten years, in the financial report of Toyota , cash assets alone, converted into RMB, have increased from 120 billion to 320 billion. What is the concept of
20 billion? Last year, Toyota's profit was only 128.4 billion, and it had cash on its books that was 2.5 times its annual profit.
The company has a lot of money in its account and is unwilling to invest or increase employee wages.
If you have watched Lao Nan's video "How to Manage Money in the Second Half of 2020", you should remember this PPT:
The Bank of Japan has been spreading money from helicopters since the Abe period, and has become the most aggressive central bank in the world. As a result If you let go of your loneliness, you won’t be able to let go of your money. This is the trouble of the Bank of Japan. No matter how much water it releases, it will be in vain.
Now, the opportunity has finally come. The Bank of Japan just wants to play big and take this rare opportunity to pull Japan from a deflationary environment for decades to an inflationary environment.
4
Of course, whether he can ultimately achieve his wish is beyond Lao Nan's ability. After all, any action is a double-edged sword.
If this comes true, Japan will undergo a wave of reindustrialization, and competition with China in high-end manufacturing will become even more intense.
If it fails, it will be a sharp depreciation of the yen, which will cause the "four" kills of stocks, bonds, foreign exchange, and real estate, which is also a serious matter.
This is why, when we wrote about Japanese real estate in the past two years, we mentioned that we should pay attention to exchange rate risks .
knot
In fact, Japan’s post-war miracle has been very impressive every step of the way.
But after all, the reality of Japan's post-war " semi-colonial " has no real and complete independent space, which also limits Japan's ceiling.
Therefore, independence is so precious to a country.
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