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Japan needs stable, sustained inflation, gov't official says

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By Leika Kihara

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"The priority now is to raise wages. Achieving wage hikes is the best growth strategy for us,"

Right, but when you have corporations unwilling to raise wages to a point where it actually matters, at or above the inflation rate, you just end up like a dog chasing it's tail!

8 ( +19 / -11 )

what Japan needs to do is raise the minimum wage from 900 yen to 1500 yen and force all companies to raise wages.

7 ( +17 / -10 )

It's important for monetary, and the broader macro-economic policy, to be stable."

Where are the self professed macroeconomic experts coming out to argue subsidies to megacorps and QE UBI for the capital rich are the saviors of the capitalist system?

Their argument, like Kihara is of zero benefit to the public.

6 ( +9 / -3 )

Inflation hits everyone, pay rises dont

6 ( +12 / -6 )

In order to have a healthy, sustainable inflation, the government has to increase demand through massive public spending, tax cuts and energy-bill subsidies. Just asking employers to raise wages won’t achieve that.

7 ( +9 / -2 )

Simple solution…. Japan is the only industrialized country that does NOT include the prices for fuel and food in their GDP…. Add those in and we’ll have instant 25% inflation…. But they can’t because Japanese farmers and retailers have been screwing the public for decades …. 3000¥ for a watermelon/ cantaloupe 25 years ago and still the same today …. But $2 - $5 everywhere else . $9 for a gallon of milk but half that price or less everywhere else . It’s time for corporate Japan to pay their share …. Sitting on quadrillions of ¥ while keeping wages below poverty…

1 ( +13 / -12 )

What Japan needs is employment garentees for part time workers and to raise the minimum wage. The working poor are the issue. I personally know people that didn't get a salary increase for 10 years.

12 ( +15 / -3 )

@ Larr Fint

This playing with inflation by the government is going to end up really bad to Japan. 

Losing all those life savings old people have just terrible. 

Starvation and poverty will follow.

You said it all. This is pure spoliation of savings . In this country pension are so low that there is no other way than to save for retirement .These savings are now destroyed by inflation.

Some will say that people just have to buy stocks or buy foreign assets buy they have been burnt in the past. This money is vital for their retirement so they can no take this risk.

2 ( +9 / -7 )

No wonder people not having children. Really falling off the cliff now.

-6 ( +12 / -18 )

Whenever a country have inflation, the majority have always gotten poorer. Inflation only benefit the top 0.01% who have massive assets and high leverage. Economists always use theoretical theories which never works in reality.

9 ( +12 / -3 )

Keep saving and scrimping !

No wage increases no spending !!

-3 ( +4 / -7 )

Yes Sir, Japan needs is Stable and Sustained Wage Increases first.

4 ( +6 / -2 )

Not the other way around, Backwards never works, give the people the means to spend and they will.

3 ( +4 / -1 )

Kihara also said the government was ready to "respond flexibly as needed," when asked whether additional steps could be taken to cushion the economic blow from rising fuel and raw material costs.

"respond flexibly as needed,

I see , he is going to go along to a yoga class.

that should do the trick.

-2 ( +1 / -3 )

Mmm. Right or wrong, most of the comments here are clearly written by commited socialists to the point of naivety. @James: you realistically believe a 65% ish pay rise is achievable?

0 ( +5 / -5 )

The food giants are all hungry for money and increasing the price through the roof as much as they can get away with in the name of Ukraine war and loving the increased revenue. Pure greed. I don't think companies are going increase salary anytime soon and if so they should demand that all and every single company in Japan increases everyone's salaries but its impossible because again companies and all buisness owners want to make the maximum amount of revenue and by increasing salaries it will defeat the purpose of getting rich.

-3 ( +3 / -6 )

Achieving wage hikes is the best growth strategy for us

Yeah but you can’t directly control wages.

Better to enact policies that lead to rising wages, rather than attempt to directly control them.

And sorry but urging wage hikes is pathetic, you guys are in charge of the country and you could enact good economic policies if you wanted to.

3 ( +3 / -0 )

Inflation only helps the rich. The rest of us are better off with deflation or zero/ultra low inflation. My net connection only works for a few hours a day now, but I'm sure you can work out why inflation is bad for the vast majority.

1 ( +4 / -3 )

I do see why people come to Japan and live in poverty,you can do it easily at home,Japan GDP is not bigger ,than Texas, California and New York combined GDP,with these 3 states combined population is bigger than Japan,US economy is self sustaining, because American spend money out of necessity

-11 ( +0 / -11 )

You are not fooling anyone. The only reason for inflation (rising prices) is to make the rich even richer. Especially the 1%ers who own 40% of the world's wealth.

5 ( +6 / -1 )

@dagon

Hi. Japan actually has a "UBI." About 2% of the population receive it.

0 ( +0 / -0 )

When the economy sucks, people save more or find ways to save more. If the government wants people to spend more, then force companies to pay more.

A healthy economy is when people are spending. You either need to make everything cheaper or raise salaries and wages. Those are the only two ways that I know works.

Anything else tends to hurt everyone eventually.

What do they say about people who do the same thing over and over but expect different results?

1 ( +4 / -3 )

We’ve heard all this tripe.before but now it is tim

e to change the narrative

0 ( +2 / -2 )

Hi. Japan actually has a "UBI." About 2% of the population receive it.

What's this now?

0 ( +1 / -1 )

"Sustained Inflation". Another new English language phase emulated from Japan. I suppose that I makes more sense than "Quasi Inflation".

2 ( +3 / -1 )

Urge less, do more.

-2 ( +1 / -3 )

Japan need to force wage increases where ever they can, starting with the minimum wage. Just telling companies to raise wages won't do much. Japanese companies are in a great position as they know that very few Japanese are willing or able to look for work outside of Japan, so they will see very little need to raise wages unless it's forced.

I think the raises we will se are within the big name corporations that for a long time have been funded with out tax money, which will probably be told to raise wages or lose the free money stream.

2 ( +2 / -0 )

Simple solution…. Japan is the only industrialized country that does NOT include the prices for fuel and food in their GDP…

I think you meant not including food and fuel in the inflation calculation. That is actually acommon practice around the world. I know the US does not include food and fuel prices in their Consumer Price Index for a very good reason. Those prices rise and fall seasonally in a predictable pattern. Food is cheapest in the summer and fall when it is grown and harvested. It is most expensive in the winter and early spring when no food has been grown for a few months (California, Arizona and Florida excepted) and supplies are running low. Incorporating food prices in a quarterly inflation calculation in March would greatly overstate underlying inflation. Likewise fuels go through seasonal price swings and are likewise most expensive in the winter when heating soaks up much fuel.

GDP calculations by definition will include the value of all food and energy sold and consumed.

3 ( +3 / -0 )

You are not fooling anyone. The only reason for inflation (rising prices) is to make the rich even richer. Especially the 1%ers who own 40% of the world's wealth.

That is not true. A low stable inflation rate allows people and businesses to plan for the future and to borrow to buy homes or expand their business noting that there are a lot of small scale business people like me out there who are not wealthy. When you have deflation nobody borrows because your collateral is losing value, your income is declining but your outstanding loan balance doesn't. Deflation chokes off investment and growth. Savings accounts pay effectively no interest. People hold off buying because they figure if they wait the price will fall. That is why economists of all stripes say low positive inflation, around 2% per year, is the best situation.

1 ( +2 / -1 )

Hate to burst your bubble, but Japan couple months ago already tried to stabilize it's currency with 15Trillion dollars by injecting it into the market. And it did nothing.

Let that sink in for a second. That is shocking.

Japan was the first QE countries ( quantitative easing) and QE is really to blame with our inflation and soon to be hyper inflation to come. So all eyes are on Japan when the government can't pick up the check with it's debit. Their is so much funny money here, I mean the government own over half of the domestic bonds!! Hope have some money in physical assets, so when you need to leave you can sell it and buy a plane ticket out.

Normies, we are in for rough times.

-1 ( +4 / -5 )

@Strangerland

It is in the constitution which makes it even more surprising that you don't know.

生活保護法 or Seikatsu hogo-hō guarantees a minimum standard of living for people unable to work, for whatever reason, and earn a living.

Many seniors collect it as they are unable to work due to advanced age but it also is a right for people suffering from mental illness or just lose their jobs and fall into poverty.

There is a means test and recipients need to sell luxury items to qualify. If you subscribe to Disney+, you would be expected to cancel that subscription first and then sell your BMW after that.

-3 ( +0 / -3 )

生活保護法 or Seikatsu hogo-hō guarantees a minimum standard of living for people unable to work, for whatever reason, and earn a living.

Many seniors collect it as they are unable to work due to advanced age but it also is a right for people suffering from mental illness or just lose their jobs and fall into poverty.

Neither of these are UBI. They are social safety nets, which UBI also is, but they are not the same thing.

1 ( +2 / -1 )

Japan do.not have a large GDP,it about double of Russia, Japanese economy need a GDP of 9 trillion dollars

-4 ( +1 / -5 )

Japan was the first QE countries ( quantitative easing) and QE is really to blame with our inflation and soon to be hyper inflation to come. 

You have it all backwards. Japan was the first major industrial nation to face deflation. There is literally only one way out of a deflationary spiral and that is inflationary fiscal and monetary policy. Japan has struggled for decades with incipient deflation. Deflationary pressures caught up with the rest of the world circa 2008-2009 and persisted until 2020.

The current bout of inflation is temporary, driven by the supply chain disruptions and material shortages caused by the pandemic and subsequent Russo-Ukraine war. Those pressures are already easing. Trans-Pacific container rates are already below their previous 2019 lows and container volume is likewise down and continues to fall. Oil prices are down from a year ago. Prices and inflation will continue to fall and mark my words, within two years the developed world will be again facing deflationary pressures. Why? The fundamental drivers, declining velocity of money, prevalence of monopoly and oligopoly in major consumer markets and market consolidation have not abated in the least.

0 ( +1 / -1 )

Japan do.not have a large GDP

It literally has the third largest GDP of any country on the planet.

3 ( +4 / -1 )

@Strangerland

it literally translates to "Livelihood Protection" and is guaranteed by law. It is a true UBI system. Universal=include everyone

Basic=ensures that all people have a basic standard of living

Income=is a cash payment.

The form of UBI that some are proposing in North America is not anywhere near a true UBI;

they want to get money to stay home, smoke pot and play video games all day without making any effort to support themselves.

1 ( +4 / -3 )

6 trillion is not bigger than California,Texas,New York Combined,the US economy is 4 times that of Japan

-3 ( +1 / -4 )

it literally translates to "Livelihood Protection" and is guaranteed by law. It is a true UBI system. Universal=include everyone

You clearly don't understand what UBI is. That is not it.

The form of UBI that some are proposing in North America is not anywhere near a true UBI;

You mean UBI is not UBI? Mmmmkay....

-1 ( +2 / -3 )

6 trillion is not bigger than California,Texas,New York Combined,the US economy is 4 times that of Japan

Japan literally has the third largest GDP of any country on the planet.

2 ( +4 / -2 )

@Strangerland

Sorry, it is you who has no idea what UBI is. Universal, Basic, Income. That my friend is exactly what Japan has and it is the main reason that there are so few homeless people compared to other countries.

UBI is NOT free money for everyone.

Canada lost $27 BILLION dollars through fraud with their COVID cash that some are calling a model for UBI in Canada. $27 billion is a lot for a small economy like Canada to swallow and with the government making no effort to claw back that fraudulently claimed benefit, any system like that would quickly bankrupt the country.

0 ( +3 / -3 )

StrangerlandToday  06:41 am JST

6 trillion is not bigger than California,Texas,New York Combined,the US economy is 4 times that of Japan

Japan literally has the third largest GDP of any country on the planet.

The state of California if it were a country, would be ranked as having the fifth largest GDP of any country on the planet.

Anyway, the GDP of California, Texas, and New York combined is larger than Japan's.

-3 ( +2 / -5 )

it literally translates to "Livelihood Protection" and is guaranteed by law. It is a true UBI system. Universal=include everyone

Eh?

1 ( +1 / -0 )

Universal, Basic, Income. That my friend is exactly what Japan has and it is the main reason that there are so few homeless people compared to other countries.

Yeah, and I could say that a cock pit is a hole you throw male chickens into, because yes, the definition of the individual words fits that. But we all know that's not what a cockpit is, same as everyone else in the world that isn't you knows what UBI is. And Japan doesn't have it.

1 ( +3 / -2 )

The state of California if it were a country, would be ranked as having the fifth largest GDP of any country on the planet.

Ok. As I said:

Japan literally has the third largest GDP of any country on the planet.

I'm not sure why you think your comment changed that...

0 ( +1 / -1 )

StrangerlandToday  07:12 am JST

Japan literally has the third largest GDP of any country on the planet.

I'm not sure why you think your comment changed that..

Who said anyone thought the comment changed anything?

So you understand that the GDP of California, New York, and Texas combined is larger than Japan's?

Easy yes or no question, although and attempt to spin away from this will be an accepted as an admission of yes.

-3 ( +0 / -3 )

Who said anyone thought the comment changed anything?

You quoted me, why?

So you understand that the GDP of California, New York, and Texas combined is larger than Japan's?

So? What does that have to do with my point:

Japan literally has the third largest GDP of any country on the planet.

----------

Easy yes or no question, although and attempt to spin away from this will be an accepted as an admission of yes.

Because that's how logic works, right? And intelligent people have shown how this logic works, right?

 

...right?

2 ( +3 / -1 )

@Strangerland

Semantics. The UBI that lefties in other countries are stamping their feet over what Japan provides, EXCEPT without a means test. The government is not your daddy.

If you are arguing that Japan should increase the amount of guaranteed income that all are entitled to, I would agree, but it is still a UBI system that seems to get results by providing enough for able bodies workers to have a basic living but not too much as to discourage people from getting a job if able.

-2 ( +2 / -4 )

Semantics.

No, words have meaning.

The UBI that lefties in other countries are stamping their feet over what Japan provides

No, it's not.

Again, you clearly don't know what UBI is.

1 ( +3 / -2 )

@proxy

I think you are stamping your feet here with a slapdash argument about what UBI means.

Not a good faith way to approach a discussion.

1 ( +1 / -0 )

Wage raises can at best only be a very small part of the solution. The majority is probably not even employed and entitled to receive any wages, raised or not. To beat inflation effects, those raises would have to be astronomically high, to spread above inflation and also above inflation income for children, seniors or otherwise unemployed. That won’t happen under old fashioned policies, therefore a very few might keep pace with inflation but the whole society on average will still suffer inflation even more, because also wage raises heat up inflation partly even more.

0 ( +0 / -0 )

@dagon

Hi. Japan actually has a "UBI." About 2% of the population receive it.

Since I was quoted to clarify:

I was referring to the fact that QE monetary easing is a sustained income for large capital holders.

As actual billionaire Mark Cuban attests to

https://twitter.com/mcuban/status/1318929147348090882

https://www.cnbc.com/2013/12/18/qe-the-greatest-subsidy-to-the-rich-ever.html

That this is cited as a means to raise wages by Kishida's New Capitalism and the BOJ is some fantastic gaslighting of the public like trickle down economics.

New Capitalism sets up some wonderful sustained income for the wealthiest in Japan.

1 ( +2 / -1 )

Semantics. The UBI that lefties in other countries are stamping their feet over what Japan provides, EXCEPT without a means test. The government is not your daddy.

Yes words have meaning. So noted "leftie" Elon Musk supports a UBI?

https://www.businessinsider.com/elon-musk-universal-basic-income-physical-work-choice-2021-8

It is actually pretty capitalist as with falling wages, inflation and automation it may be the only thing to maintain a market economy and socioeconomic stability.

There are dangers though but the crony capitalism of the LDP and Kihara Seiji is a more clear and present danger.

1 ( +1 / -0 )

The state of California if it were a country, would be ranked as having the fifth largest GDP of any country on the planet.

California's GDP just this past year bumped Germany out of the number 4 spot.

0 ( +0 / -0 )

New Capitalism sets up some wonderful sustained income for the wealthiest in Japan.

Wealthiest foreigners in Japan.

-2 ( +0 / -2 )

@Mandy : It did nothing? The BOJ could slowly unwind that trade the other way and make an awful lot of money back. Are you aware what happened on Dec 20th?

0 ( +0 / -0 )

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