Businesses wary, spending plans flat: BOJ survey

So now the tax hike has hurt the economy after an initial, obvious boost and the spending to beat the clock to it, surprise surprise, but they're going on increase it again in 2017. Kuroda was dead wrong in doing what he did, but he insists he's right and its not his fault. Pension and health care costs will also increase, but people are being asked to spend more. Declining birthrate and aging population are starting to finally be seen as the major threat they are, but no serious means are being taken to address it except "print more money, raise taxes more, then ask companies to please kindly give their staff more money", which fails every time. Companies and people have a right to be wary of how things are going to go. You'd be insane not to. The downward spiral is increasing in speed.

Thanks to Abe San ..Japanese people had no choice to choose between bad and worst...lower bracket people are struggling and suffering...

Businesses wary, spending plans flat

very disheartening news, only thing good that buzz word 'Abenomics' is no more in use by professional media persons.

Annual labor negotiations wrapped up last month with larger-than-usual wage increases for union employees of many of the largest companies, but overall they account for a minor share of the workforce, and incomes have continued to fall over the past several years.

I was at HelloWork yesterday and the lady told me these wage increases are only for a small percentage of Japan's workforce. Virtually all small and medium-size businesses are LOWERING wages. Look at the headline, "Businesses wary", you don't raise wages when you are wary about the future.

Prime Minister Shinzo Abe and others in his government say they expect the strategy to stimulate a “virtuous cycle” of spending and investment.

Id really like to know where this parallel universe is that Abe and his cronies live in. Since the sales tax increase spending has decreased by nearly 10% (Mitsukoshi has recorded a 25% drop in sales). Companies are laying off employees in the hundreds and thousands. Salaries have not been increased. Private school inductions have dropped by nearly 20%. And, company manufacturing has dropped by 10%. Where is this place with a 'virtuous cycle' of spending and investment?

Print more money!! Manipulate exchange rates further!!! If no one can see that even a modest tax hike as a reason for no growth shows that there is almost no chance of getting "real" exconomic growth in Japan any more, then we are all doomed. i think a gentle continuation of the stagnation is no bad thing.

And today, April 1st, loads and loads of companies raised their prices. It is an absolutely desperate situation for mr and mrs. And family.

The central bank has been pumping trillions of yen into the economy through asset purchases aimed at keeping interest rates low and stimulating inflation.

NOT

The aim was clearly to further increase the wealth of the investing and corporate elites. Why else create a stock market bubble?

Prime Minister Shinzo Abe and others in his government say they expect the strategy to stimulate a “virtuous cycle” of spending and investment.

They can say what they like and then there are the facts, which show them to be a spurious bunch.

The leading measure of business sentiment, based on a survey of 11,126 companies of various sizes, showed more than two-thirds of all companies anticipate further deterioration in conditions, with 83% of large manufacturers branding conditions "not so favorable" or "unfavorable."

They should know how to read the numbers.

Look at Table 1 "Gyokyo Handan" on page 2. http://www.boj.or.jp/statistics/tk/gaiyo/2011/tka1503.pdf

Respondents are asked to choose an answer from 1 good, 2 not so good, and 3 bad, to a question about their business environment. Here is the summarized data.

Large Corporations, Current; 3 Month Outlook

1 Good, 21%; 17%

2 Not so good, 70%; 76%

3 Bad, 9%; 7%

It is true that by adding 76% and 7% you get 83%. But "Not so good" actually means neutral. "Good" out-numbered "bad" by 10%.

Here is a link to Reuters of the news on the same tankan number. http://www.reuters.com/article/2015/03/31/japan-economy-tankan-idUST9N0WK00620150331

Japan big manufacturers' confidence steady in Q1 -BOJ tankan

The headline index for big manufacturers' sentiment was unchanged from three months earlier at plus 12 in March, the Bank of Japan's quarterly "tankan" survey showed on Wednesday.

The number "12" is calculated by "Good" 21% minus Bad "9%".

more stimulus is needed to sustain growth

The wrong medicine won't work, even if taken in increasingly higher doses...

But Kuroda and many other economists say monetary easing and government spending alone cannot fix Japan’s problem with weakening demand, due to its aging and declining population.

Kuroda and those many other economists have this right. The demographics can't be changed, but the useless politicians and their useless policies can be - relatively easily, if the will is there.

Kuroda was dead wrong in doing what he did, but he insists he's right and its not his fault.

That's unfair. Kuroda kept his side of the Abenomics deal, but Abe has not kept his own promises, which are the true key. Abe's been too busy cranking up the military, reinterpreting the constitution and holding elections to actually implement his promised reforms, which still today are to be outlined in detail "by next summer". Just like last year, and the year before. The LDP simply can't do what is required, and they need to go.

At least one positive is that this reflationist's notion of doing QE in Japan has been proven again to be a failure, in terms of rectifying the economy.

Usually "no big change" is better than a "change for the worse".

Today's news: it's April 1 everybody ... and no April's fool stuff here ... prices will be going up almost across the board in Japan. Thank you once again Mr. Abe. Hope you soon reach your 2% inflation target 'cause things are getting really expensive ...

Japanese businesses remain wary over the outlook for the world’s No. 3 economy and generally plan to reduce capital investment,

The Bank of Japan’s quarterly “tankan” survey will likely reinforce the conviction among many that more stimulus is needed

showed more than two-thirds of all companies anticipate further deterioration in conditions, with 83% of large manufacturers branding conditions “not so favorable” or “unfavorable.”

Japanese businesses anticipate weak demand both at home and overseas for their products and higher costs for materials thanks to the weakening Japanese yen.

Congratulations Abe and BOJ, you have created the perfect storm. You pumped trillions of yen into the market which, did not generate a real/sustained bump in domestic demand -- mainly due to the tax increase -- but did lower the yen, which raised both consumers' and companies' costs, and now the only way to try to keep from going into another recession, is spend even more money. And over 80% of the large manufacturers -- i.e. the big companies that hire lots of people and spend money on capital improvements -- are betting against you. Elevator going down.

Japanese companies are not going to invest in a failing economy- who would? Therefore, wages won't rise will they? Watching Taro Aso inspect his ear wax in the Diet this week I got the feeling that It isn't really the ordinary voter that inspires Japanese politicians to do their jobs....