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© Copyright 2022 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed without permission.Soaring U.S. dollar spreads pain worldwide
By PAUL WISEMAN, KELVIN CHAN, SAMY MAGDY and AYSE WIETING WASHINGTON©2024 GPlusMedia Inc.
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TokyoLiving
What a world madness, anyway the days of the dollar pirate will be numbered, the world will be freed from the imperialist slavery of that filthy currency..
Rakuraku
Today 07:03 am JST
Which currency for you think will replace it?
Yrral
Nobody tell anybody to use dollars
JeffLee
Blame Russia and China. They are responsible for the twin global supply shocks fueling the inflation that the US Fed is now forced to fight through higher interest rates. Ending the pain is easy: Russia leaves Ukraine, China lifts its lockdowns. Problem solved.
tora
Mwanwhile, the Ruble....
virusrex
Hard to think this is the best system economists have managed to come up with, it is almost as if the purpose was not to support development all around but instead to concentrate the money in as few hands as possible.
kurisupisu
Well, the option is not to buy imports but to buy locally made goods.
However; in Japan the cost of locally produced goods is always way higher, except for cars.
Chico3
I'm still a believer that nothing is forever, including this. I recall this happening back in '98. The yen got stronger about a year later and continued to get stronger.
Yubaru
Not "especially" really, here in Japan alone it has dropped over 18% for this year, and going back a year or so, over what, 30% , maybe more?
Everyone is getting hurt and granted poor countries are going to get hit harder, but it isnt any "especially" weaker in those countries compared to here!
The Avenger
What Republicans in the US want you to believe is that Joe Biden has caused our economic problems.
The truth is things are much worse than that. We have major global economic problems and it's affecting countries everywhere. The United States is only a part of it.
Michael Machida
The American system really is best. Wow! Go America!
Yubaru
Not "always", and just an example here, AEON, the largest supermarket chain in Japan, has contracts with local vegetable farmers, to put their products in their stores, and their prices are notably lower than similar products sold in the store.
People have start shopping smarter. Even with AEON group, the price of many items DOES differ, depending upon whether one purchases it at an AEON Department Store supermarket, MAX Value, or BIG. The prices are always higher at the department store, and much lower at BIG.
One other problem though is that Japan is NOT self sufficient in food production, and MUST import from foreign countries to meet demands. Even so, depending upon the product prices are still cheaper, due to the unbelievable amount of "product" that AEON purchases at one time. Which helps to keep prices down.
Sh1mon M4sada
Hmmm on what world is this? What's the name of your home planet?
Try visiting earth, you'll see (all over the world - especially Russian and Chinese) investors, governments, the average citizen that can spell have been mopping up the USD, because they know in times of war, a flight to safe haven the U$D is their only option to preserve capital.
Without the USD, starvation is a certainty because trade would cease, because other fiat is untrustworthy. Even China doesn't trust its own fiat, hence capital controls.
Joemusic1980
Communist code words always make me laugh. America has never been an empire nor will it ever be…
Sh1mon M4sada
It's just human nature to go for safety, it's no system. We're just lucky USA decided NOT to have capital controls, so there's at least one form of trade currency still trustworthy.
Chabbawanga
The dollar will eventually crash, but until then it's more hurt for everyone else. Think it is time we started thinking about a new reserve currency that cant be printed hand over fist.
Bitcoin anyone?
Septim Dynasty
This will accelerate the global multipolar, de-dollarized financial systems among the non-West nations.
The US and its puppet states (like Japan) will only feel the pain of an eternal economic depression for years to come. It's really sad that Japan chose the wrong side.
Japantime
Luckily I am living in Japan and there hasn’t been a noticeable increase in prices. The price of the new Iphone in Japan is one of the cheapest in the world.
EvilBuddha
A strong USD is not good for the US either. It makes imports cheaper for Americans.
It gives Americans more of an incentive to buy from abroad, be it goods, finished products or services.
Tariffs can counter it to some extent but tariffs only create market distortions and make local industries less competitive.
Somewhat like the Dutch Disease.
mountainpear
@Japantime Does your wife do all the grocery shopping? Only explanation I can think of for not noticing the big increase in food and other prices!
Mohan
Also Cross Currency exchanges with Dollar at center would hurt. How about doing trade with neighbors?
Instead of relying on Dollar as a known common currency, accept regional currencies with calculated risk.
fallaffel
Any evidence for this, or is it pure fantasy? Saying things are sad because something unlikely might happen is not very convincing.
Yubaru
So, please share with everyone how an I-phone tastes and what recipes you use to cook them.
One has to be living in the dark to not realize how much prices have risen here in the past couple of months alone.
Blacklabel
Because he has. Clearly and obviously.
Japantime
i go to discount supermarkets. Also I don’t spend all my time is Starbucks buying expensive coffee.
nero
I've been told many times vote Trump and you'd have war and chaos
wallace
The prices of all devices have increased along with many more items. Imported devices have also increased in price because of the value of the dollar.
In the US the iPhone SE is $429 which would be ¥62,000.
In Japan, the iPhone SE is ¥62,000 which would be $429.
Chabbawanga
BRICS countries are already in discussion about a new reserve currency. Rightly so. Why should these countries let the US dictate how global trade is carried out.
https://economictimes.indiatimes.com/news/economy/policy/brics-explores-creating-new-reserve-currency/articleshow/94628034.cms
Blacklabel
Yen rate sure is stuck around 149.90-.95 so guess the intervention is expected at 150
Hito Bito
Jeff Lee. Hmm...you put zero blame on the Fed deciding to let "inflation run hot" for a while (their words), when they should have been raising rates more than a year ago? No error in claiming that this worldwide inflation was "temporary"? Really??
lol. Don't look over there...look over here!
Sven Asai
Well, but haven’t they told us endlessly the problem’s solutions? Robots will do the work and bring in with their easy to bear 24h hard working all the needed wealth, taxes, profits for everyone of us so we have plenty of leisure time and can still swim in tons of money, and the green energy for all that will come almost freely from limitless available wind and sunshine. And still everyone is believing and voting for all that. So I wonder why they now all cry out loud about a few insignificant problems related to currency exchange rates.
JeffLee
@Hito Bito
Well, the Fed didn't predict that Putin would invade Ukraine and didn't expect that China - "the world's factory" - would continue to keep 100s of millions of its people under house arrest well after the covid pandemic subsided. But then, no else did either, did they.
Illyas
Once again with this absolute bollocks. Russia invaded at the end of February, yet US annualized CPI was already at 7.9% then (February 2021 to February 2022). This constant attempt to shift the blame for inflation to Russia is a blatant attempt to cover for politicians and the Fed for screwing up.
tttccc111
Yes, US spreads plain to the world.
So our BOJ has any plan? While the whole world is expecting inflation will last for months, our BOJ just smartly predict that inflation will go away early next year.
Hito Bito
"Well, the Fed didn't predict that Putin would invade Ukraine"
That would be a good argument...if it weren't for the fact that inflation was already "running hot" almost a year before Putin invaded Ukraine, so...no. Also, Zero COVID has NOTHING to do with the Mandate of the Fed. The FED's job is to protect the US economy. Everything else is tertiary.
When your mandate is to keep inflation under control yet you decide to print and put out more than 2 Trillion USD extra, on top of all the rest of that fiat money sloshing around the world already, even with steady, positive GDP growth? To keep QE going even then?! That's what I call a Failure to Follow Mandate.
Just admit that your precious Central Bankers aren't the wondrous wizards of finance that you hype them out to be...for a start!
albaleo
I think taking control of half a continent might class as creating an empire.
*empire**: an extensive group of states or countries under a single supreme authority*
Laguna
VirusX, economists don't come up with economic systems; they simply describe how politicians and consumers behave.
Yubaru
Me thinks you need a different calculator.
$429 USD to yen is 64,291
62,000 Yen to USD is $413.73
Mark
2023 will be the year of recessions by the look of it, it is on track to bring pain and misery across the globe. buckle your seatbelts ladies and gents.
JeffLee
@Hito Bito
Which was precisely when the economic effects of the pandemic, aka “the global supply crunch,” were most intense. Culprit: China. Those effects are still being felt: wait times for a new car in the US are still generally around 3months.
Sorry, that’s nothing to do with “money printing” and all to do with the intense squeeze on the global supply chain from China’s harsh covid measures.
Then came Ukraine, compounding and prolonging this unprecedented situation. Thanks China and Russia.