Japan consumer inflation slows; spending down in September


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Even printing money at full speed not working.......

3 ( +5 / -2 )

I deliberately dropped my spending monthly by 3%. Not a problem to do.

0 ( +2 / -2 )

Politicians - understand this - economies cannot grow forever on finite resources - our planet. So develop responsible policies that don't focus on growth. Economies and the planet have reached their limits and the former clearly can no longer be artificially proper up by government spending/stimulus packages. Falls in spending and growth will be inevitable as the fundamentals of capitalist economies are readjusted to the realities of the universe. Again: with finite resources - economies cannot/will not keep growing.

0 ( +2 / -2 )

Separate data from the ministry showed household spending in September plunged 5.6% from a year earlier.

It was worse than a market median forecast of a 4.2% drop and extended declines to a sixth straight month since April

Abenomics may not quite be on life-support yet, but it is definitely in the ICU. Storm clouds are gathering -- fast.

4 ( +9 / -5 )

Food prices have been expensive due to weak yen which increases petrol cost required for any machines in agriculture, fishery and etc. Of course purse strings are tightened.

3 ( +4 / -1 )

Even printing money at full speed not working....... it took over 5years and $5trillion for the Fed reserve money printing to show any results, dont think Japans money printing is over by a long shot

0 ( +1 / -1 )

We were supposed to see an 2% increase in growth and inflation this year, and the improvement was supposed to begin in the third quarter. It looks like it didn't occur, and now negative growth for the year are inevitable.

0 ( +3 / -3 )

There is only one way out: Japan declares a default! Why they make everyone suffer for so long?

People work like robots for long hours... For what? to put food on the table and have a roof over their heads? Outside big cities the country falls apart and start to look like a third world country...

In the end default is the only solution cos this exponential interest money system cant go on for ever....

4 ( +6 / -2 )

So, the tax increase has been a failure, as has Abenomics (notice it's not mentioned ONCE in the article! -- the word is now a curse!), and any further increase will derail (not 'detail') any economic recovery. What's there to discuss? Obviously the tax should not be further increased, and Abe still needs to work on pulling his third arrow out of his quiver.

2 ( +7 / -5 )

A textbook case of how you should never raise everyone's taxes while trying to stage a recovery from a recession caused by insufficient domestic demand.

They teach that in Econ 101, but evidently not to Japanese politicians.

5 ( +7 / -2 )

One of the problems of the sales tax increase was retailers using the sales tax increase to bump up their prices 1-2%. Did anyone else notice shops showing the pre-tax price and the new tax-included price and that the pre-tax prices was higher than it was before April? A lot of prices went up by about 5% overnight.

6 ( +8 / -2 )

So household spending is down year-on-year. Meanwhile, the retail sales data for September was up 2.3%.

What's the takeaway, anybody?

1 ( +1 / -0 )

Japan is suffering more than 25 years now and with the aging population and never ending debt increase what option they have?

Try to raise tax and see how this is going.... NOT WORKING Try to print money to increase inflation... NOT WORKING

How about doing a cyprus styl cut on all savings? But with 8 Mio Yen debt per person will also NOT WORK.

Only solution is : declare a default, all savings lost and all debt gone. Start all over again.

Happened in Argentina a few times past decade, happened in Russia, Zimbawawe,...

Who will serve all the bonds when older people take their money out?

This will all collaps out of the blue one day.

-2 ( +2 / -4 )

BOJ has just announced they'll buy even more bonds each month, as well as other assets. Good if you are rich. I am quite surprised, hadn't expected Kuroda to go feral like this, but then he does know how to impress the markets.

4 ( +4 / -0 )

No worries, BoJ just announced it will conjure more money, this time, the corporations will definitely invest those money to create more jobs, if not a few orders of private jets and yachts from bank executives would definitely help the economy.

1 ( +2 / -1 )

I am quite surprised, hadn't expected Kuroda to go feral like this, but then he does know how to impress the markets

The markets are not impressed, they think Abe and Kuroda are fools, and that their monetary policy is idiotic. But the markets know they can take advantage of policy changes to earn a little short-term profit. There is still time to jump off the boat before it goes over the falls.

3 ( +5 / -2 )

Japanese economy ,what a hopeless basket case really. Hopeless!

-3 ( +1 / -4 )

Only solution is : declare a defaul

It will never happen. More BOJ buy bonds, Japan govt have less debts from the private, which means less debts.

-2 ( +0 / -2 )

"Only solution is : declare a default, all savings lost and all debt gone. Start all over again."

I'm sure happy you're not in charge. Japan can never default. How could it ever have a shortfall of a currency it has the sole authority to issue?

-1 ( +1 / -2 )

Are these clowns aware that spending has consistently decreased since the sales tax hike? Yeah, it has fluctuated each month, but the over all trend is way down from before the tax hike. They increased the sales tax to combat the world's largest debt and now, their solution is to borrow more money to make up for the deficit in spending. I can only use one word to describe the logic of Abe and his team of economist cronies, "Baka!"

2 ( +2 / -0 )

Prices of just about everything here up between 5-10% in the last year and soon to get even worse, wages stagnant or in retreat, a palpable sense of discontent and helplessness and growing indications that for many the stress is too much to bear. Despite all that, you can rest assured that fast forward five years more bumbling failure and people are going to be waxing lyrical about 2014 as a golden age of plenty and contentment. Yase gaman indeed!

0 ( +0 / -0 )

Normally I don't say "I'm glad I'm in my mid-to-late 40s." But with the coming stuff related to Japan, I'm not hating my age right now.

Too much whining here though. Of course Japan's export-heavy businesses need support, the sin that Minshuto committed was trying to be on the side of the "salarymen" and their wives, without supporting the companies at all. Hence everyone went into a tailspin, until the Earth actually shook to repel the party (3/11/11). Japan is nothing without its famous companies.

0 ( +0 / -0 )

Meanwhile, the retail sales data for September was up 2.3%. What's the takeaway, anybody?

Sure, September was a good month.

The uptick could be seasonal; retailers often have sales drives this time of year. There will always be months that are better than others. It doesn't mean the economy is getting better. Unemployment levels are dependable indicators of a country's economic health, and Japan's is rising

So household spending is down year-on-year.

True, so, what can be taken away from that fact?

Incomes are strained, and stagnant.

The "virtuous cycle of consumption" PM Abe envisions (yet works against) will only happen if consumers have more disposable incomes, and businesses retain more of their profits to reinvest, or doll out raises.

Right now, businesses have no leeway, or incentive to pay their employees more money. Consumers have no incentive to spend more as their incomes haven't gone up enough.

The take away here should be that the tax hike is ill timed, and unnecessary.

0 ( +0 / -0 )

JB, take a look at these - retail sales look OK to me as a trend.

Abe needs to deregulate the economy if he wants people to get better incomes, IMO. If I were to get a tax break, I'd just save the money (or invest, or divest into foreign currency), but that's just me.

0 ( +0 / -0 )

It is pretty obvious that there is no real way to grow Japan's economy-for those in Tokyo or Osaka when you look out your window it is plain that there just isn't any spare land. The Japanese suffer from 'the rats in the cage effect' hence the reluctance to have children- no demand there!

The only way to give the illusion of growth is money creation.

Recent reports of QE in the US suggest failure.

Greenspan (ex Fed chairman) is on the record saying that Americans should buy gold due to the out of control inflationary pressures that are building.Argentina and Weimar Germany have shown what happens when the money supply becomes inflated. Still, there'll always be a use for banknotes as lavatory paper or fire starters ....,

1 ( +1 / -0 )

take a look at these - retail sales look OK to me as a trend.

Abe needs to deregulate the economy if he wants people to get better incomes, IMO. If I were to get a tax break, I'd just save the money (or invest, or divest into foreign currency), but that's just me.

Yes, retail sales have improved but, again, we're hitting a peak shopping period. I'm more interested in the numbers down the road, from now till the end of April 2015.

The figures people should look at are January to March of this year, especially March. Retail sales would've been more robust if the consumption tax had remained at 5%.

On tax breaks, many people would largely bank their tax saving, given the uncertainty regarding public pensions, rising costs, and the economy, it's understandable.


People need more disposable income to make the tax hike work (plus government spending cuts). If people's incomes are continually squeezed by taxation, and the unnatural, government spurred inflation, the "virtuous cycle of consumption" won't happen.

Businesses are getting kicked in the teeth with taxes too. So, raising salaries isn't feasible, unless the government allows them to keep more of their profits.

Higher VATs should be offset by cuts in income and business taxes. That's economics 101. This is PM Abe's failure: not alleviating working people, and business of their onerous tax burden.

On deregulation, I agree. The Japanese government is exceptionally interventionist in the economy. Deregulation is a good idea. I'd go a step further, and have the Japanese economy openned to foreign investors.

Globalization is often decried by those on the left, but, our world is inter-connected, and business is pan-national. As a Canadian, I know the kneejerk reaction is to resist or limit foreign investment.

However, foreign investment brings jobs, capital, competition, and vitality into the economy. It forces domestic businesses to up their game, and innovate.

Back to the sales tax,

The main argument against it is: it doesn't grow the economy.

0 ( +0 / -0 )

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