Japan's current account surplus doubles as exports rise

For decades, Japan had accumulated solid current account surpluses, but the surplus for 2012 more than halved from a year before to 4.7 trillion yen.

Those who keep bitching about other nations manipulating their currency, so why can't Japan?

This is why. This is also why the Japanese Yen should be in the 80 to the dollar range, if natural forces were allowed to take their natural course.

Japan's economic problems are domestic, an inefficient domestic economy propped up by inefficient governments who spend the Japanese people's money like the good days of the 70s and 80s never ended.

It's not rocket science, it's very very basic economics.

Oh by the way, unless the Japanese see the light and start breeding like rabbits, while allowing in millions of guest workers from Africa and poor Asian countries (the number of countries available are declining with each passing year), then there is no way in hell Japan can maintain its current account surpluses; currency manipulation or not.

Aside from those who see the down side all the time there are positives -

A fresh sign the government’s aggressive policies to stimulate growth are paying early dividends.

There are encouraging signals for the economy.

Bank of Japan’s ultra-loose monetary policy is prompting companies to spend more.

Dog japan is changing and abe has even stated the immigration policy will change.

Things take time so atleast give things some time to be implemented and results seen please.

This is also why the Japanese Yen should be in the 80 to the dollar range, if natural forces were allowed to take their natural course.

There is no such thing as "natural force" in currency transaction, it's all manipulated by man.

The yen is breaking 98 mark this morning too.

$7.5bil current account surplus and such a bold headline?

we need reforms..

education; the German model

internships during tertiary education (to foster integration from books to workplace) greater corporate sponsorship's during high school (corporate scholarships). a university entrance system that incorporates 1-2 years of semester based test scores, as well as, the final exam.

Energy: Europe/America

End the monopoly, of energy utilities. diversify energy resources. regulation to cut inefficient energy use.

Bureaucracy/politics

technology (computers/databases/networking) to enhance efficiency, and induce a mentality of efficiency = norm. political reforms; voting legislation, decreasing the salary of politicians.

and lots form..

unlike most countries this nation is capable of achieving such reforms.. because its a conformist state. If the majority does, the rest follows..

You cannot live a happy life, without a healthy mind, and to have a healthy mind, one needs a healthy body.. the nation is much the same.. today Japan is decaying.. literally from old age. Because the politicians are old, grumpy and risk averse... and like most old people, they hate change..

People are so easily deceived. 'Abenomics' is just smoke and mirrors. None of the real problems are being addressed

Hurrah!!! Now just switch the nukes back on and all our problems are over.

Japan's economic problems are domestic, an inefficient domestic economy propped up by inefficient governments who spend the Japanese people's money like the good days of the 70s and 80s never ended

Dog,

I have read that a half of tax money that is supposed to go to Tohoku Restration projects popped up for talent show promoting local OMIYAGE goods in different prefectures in Japan. The money was not spent for a right cause to help people of Tohoku who are still in need. I interpreted this as a moral corruption of Japanese civil servants and politicians. Shame on them!!

I like the changes Abe is doing. I don't know if they are appropriate or not, but at least something is changing since Abe took office. I feel Japan is trying to integrate better with other nations, leaving the state of isolation from the rest of the world. And that is so good.

Japan need friends. Need to sell its technology to emerging countries, need to build more parnerships, need to help poor countries while bringing culture, knowledge and japanese goods, services and companies to these countries. Japan need to go abroad.

I am very proud to see that Japan is in negotiations trying to sell nuclear energy technology to other countries. Also, happy to see the current government is trying to boost its military defense capability going training with the USA.

But Japan has more to offer to the rest of the world. Train/Subway technologies, infrastructure, food industry, drug industry....

Also Japan has a lot to learn with others. So integration with others is good. In my point of view, Abe is doing well.

And how much, pres tel, has the debt increased?

the debt doesn't matter... they can just print several trillions of yen to cover it.

The problem is that Japan's recovery is based on currency valuations! Their domestic industries haven't become more efficient and there is no indication that the extra money the exporters are taking in are trickling down to the average citizen.

They're not going to change course by introducing inflation, they need sweeping reforms across the board.. which may be politically unpopular, and we damn well know politicians don't care about anything else except for keeping their jobs

Bank lending rose 1.8% in May from a year earlier

this doesn't make sense.

higher bond yield leads to low capital on banks that leads to reduction in the amount of money bank can lend which leads to the increase in high interest rate which results in the increase in debt payment which leads to high interest rate. so what were people borrowing money for? to pay their debt?

Going up in terms measured in the number on Yen after the Yen's purchasing power has been decreased by 25% is a pretty silly measurement to make. If you are not going to adjust for inflation then why even report on the numbers?

higher bond yield leads to low capital on banks that leads to reduction in the amount of money bank can lend which leads to the increase in high interest rate which results in the increase in debt payment which leads to high interest rate. so what were people borrowing money for? to pay their debt?

You mean people stop borrowing when the interest rates go up?

nigelboy Jun. 11, 2013 - 03:11AM JST

You mean people stop borrowing when the interest rates go up?

well according to basic economics theory, if interest rate goes up, the cost of borrowing money goes up. if the cost of borrowing goes up, it would discourage a person of rational mind from borrowing money. but the money-lending has increased even though the cost of borrowing money has gone up. so one would obvisously become curious to know the nature of this money lending business, right? is this money-lending politically motivated or is it based on a sound economic model?

people are more inclined to save if rates go up... which in japan is absolutely hilarious because rates are already rock bottom and that hasn't spurrned on cosumer spending, this nation of savers are saving at 0.1%. If rates jump to 1% people will be throwing even more money into banks.. but hold on!! Inflation at 2%?!?! that will errode your savings purchasing power so you better spend it today!!!

well according to basic economics theory, if interest rate goes up, the cost of borrowing money goes up. if the cost of borrowing goes up, it would discourage a person of rational mind from borrowing money. but the money-lending has increased even though the cost of borrowing money has gone up. so one would obvisously become curious to know the nature of this money lending business, right? is this money-lending politically motivated or is it based on a sound economic model?

That's not an "economic theory" at all. People borrow on the anticipation that rates may be even higher in the future and in some cases like housing which had a 2.1% increase, wants to purchase before the increase in consumption tax kicks in.

nigelboy Jun. 11, 2013 - 10:06PM JST

That's not an "economic theory" at all

you are wrong. the theory of price is so fundamental in economics theory we call it a law. there are many economists who do not support expectation hypothesis(EH). for example there is a paper that investigates the expectation hypothesis in japanese bond market ( http://research.stlouisfed.org/publications/review/article/4106 ). it says "All in all, the EH appears not to fare well in Japan". it was published in 2004. it is amazing that somebody already knew how abenomics would work out.

it was published in 2004. it is amazing that somebody already knew how abenomics would work out.

Ha! Thanks for the laugh of the day.

you are wrong.

No. What I'm talking about is your ultimate theory is that people/companies don't borrow as much when the lending rates are high.

For instance, in 1994 the average contract on interest rates for new loans was about 3.4%-3.9% but the outstanding amount of loans outstanding as 480,267 (billion yen). Ten years later, despite the interest rates for new loans ranging in 1.5 percentile, the loans outstanding reduced to 404,000 (billion yen). Despite BOJ efforts to get the lending markets going for over a decade now ,the December 2012 average interest rates of new loans less than 1%, it still only 433,000 (billion yen).

nigelboy Jun. 12, 2013 - 11:53PM JST

No

yes. you are so wrong. the theory of price is a law. fed chairman bernanke and probably mr. kuroda too makes his monetary policy decisions based on this law. so i suggest that you think more carefully about the quality of your data. i don't want to start to think that abenomics is built on false data.