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Japan's April trade deficit grows to Y520.3 bil

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The trade deficits are getting bigger and bigger,the productivity is getting lower and lower.

Japanese debt is the highest in the world!

How to pay for all this red?

Put consumption tax up?

That will lead to even more deflationary pressure as people will reduce spending even more.

If wages don't rise then neither will spending..........

4 ( +4 / -0 )

Japanese debt is the highest in the world!

that's right, but who cares people here are looking at world's tallest tower !

4 ( +4 / -0 )

The glass half empty approach.

Japan still runs a current account surplus on revenue from her investments abroad.

-5 ( +1 / -6 )

Soon they will have to fire up the nuclear plants again.

4 ( +7 / -3 )

yep if they want that dificit to disappear in the short term they have no choice but to fire up the nuclear reactors to reduce the amount of gas/oil being imported. but shouldnt be a problem since Tokyo Sky tree should be able to make up the shortfall. !?

0 ( +2 / -2 )

just wait till the bond collapses

0 ( +1 / -1 )

The policies of the government are coming back to bite them on their butts. That and scare tactics.

0 ( +1 / -1 )

Nice, my car is pictured. It's hard to find Made in Japan cars anymore, everything is being manufactured offshore. But the trade deficit proves Japan is in quicksand.

1 ( +1 / -0 )

Has nothing to do with the radiation plants. Just leave 'em off.

0 ( +1 / -1 )

The trade deficit is temporary – it basically came entirely from two countries – Saudi Arabia and Kuwait because all the nuclear reactors have been shut down hence the increased consumption of LNG for power generation. Right now Japan has trade surpluses with basically every major region in the world (North America, Europe and China) save the oil export countries in the Gulf. Japan is also the number one exporter of advanced capital goods to China, and exports to the U.S. rose more than 40%!

Therefore once the nuclear reactors get restarted, the trade deficit will be gone, and if the Yen can weaken significantly, Japan will enjoy record trade surplus again.

BTW, buried in the doom and gloom is the inconvenient fact that Japan is the world’s largest creditor nation for the 21st straight year with over 3 trillion dollars in net assets.

Ganbatte Nippon!

2 ( +4 / -2 )

BTW, buried in the doom and gloom is the inconvenient fact that Japan is the world’s largest creditor nation for the 21st straight year with over 3 trillion dollars in net assets

Forget it 1standgoal. You're preaching the wrong crowd to make them understand what this means.

-3 ( +1 / -4 )

A bit more basic explanation would be a good accompliment , the finace pages seem over informatve with gobbledygook and JT a bit to simplistic. I appreciate the reader comments. I dearly hope the doomsays are incorrect but most JPNS I speak to don't seem posative about the future economic outlook. Any suggestions?

-1 ( +0 / -1 )

More money is leaving Japan than coming in. This may be a good thing since the yen will start to devalue. 1standgoal, it is not a temporary, the competition for oil and gas will become worse.

The sun is so pretty as it sets. While this is going on the government in Tokyo is in hopeless confusion. They want higher taxes to lower the money supply more. So lets enjoy the sun as it sets upon this period of Japan.

0 ( +0 / -0 )

A bit more basic explanation would be a good accompliment , the finace pages seem over informatve with gobbledygook and JT a bit to simplistic. I appreciate the reader comments. I dearly hope the doomsays are incorrect but most JPNS I speak to don't seem posative about the future economic outlook. Any suggestions?

It seems that the entire world is joining in the "reduce the debt" bandwagon when such reduction should not be happening in Japan with her deflation and surplus. What should be done is the complete opposite which is more government spending especially on infrastructure to stimulate the construction which will lead to increase in service sector.

-4 ( +1 / -5 )

@nigelboy:

Yeah, no kidding :D

BTW, why are so many folks on this forum so bitter?

0 ( +1 / -1 )

@YuriOtani:

Sure, Japan has its problems (who doesn't?), but in many tangible aspects such as net international investment position, corporate and household savings, current account surpluses, near monopoly position in key industrial components, robust financial system...etc it has never been more wealthy and dwarfs the amounts during the supposed golden bubble era.

And don't you think it's kind of weird that for an debt-ladden economy on the verge of debt induced collapse (if you believe the "experts"), its biggest problem for the past two decades has been the Yen been TOO STRONG?

-1 ( +1 / -2 )

BTW, buried in the doom and gloom is the inconvenient fact that Japan is the world’s largest creditor nation for the 21st straight year with over 3 trillion dollars in net assets.

1standgoal -- you of course realize, since you are obvious international finance expert, that this position of Japan also has some significant downsides? First off, it means that Japan is attracting very little foreign investment, which is included in the net asset calculation. Not a good sign for the long-term prospects of the country. Second, it potentially indicates that Japan is still too export oriented for its growth, and too weak in regards to domestic consumption. Which makes it difficult for the government to stimulate the economy, as has been proven by the ineffective pump-priming measures of the past two decades. Finally, and associated with my second point, it makes Japan much more sensitive to foreign currency changes, as the past year has indicated. And, respectfully, that is not bitterness, just reality.

0 ( +1 / -1 )

Gee herefornow. Since China is the second largest, does this mean they are not attracting foreign investments, either??? LOL. What about germany which is ranked third? Sometimes I wonder what kind of thought process that goes into some of these Japan doomsayers.

And no. Japan has not been export oriented for their Exports/GDP has been less than 15% for over 25 years. Those label are for Korea, china, and Germany.

-1 ( +1 / -2 )

@herefornow:

Let's examine why Japan have a such low FDI rate: Japan is the world's largest creditor and hence the world's largest EXPORTER of CAPITAL, so why would they need foreign capital for its economic well being?

Ironically, Japan's "debt problem" is not by lack of capital, in fact, it's the opposite: it's because capital is so abundant! After the bubble burst, Japan's private sector accumulated huge surpluses (especially its corporate sector) equal to 8-9% of GDP annually; this huge pool of money has to go somewhere, and more often than not, it ends up in JGBs. In some estimates, J corporate is sitting on more than 3 trillion $ of cash, cash equivalents, and long-term investments.

So why the heck does Japan's public debt keeps climbing yet its yield keeps falling?

Because: J private sector keeps generating huge surpluses each year,

And: these surpluses are in turn deposited in J financial intermediaries such as banks/insurance companies/postal savings...etc

And: J financial intermediaries invest these funds in JGBs..... so on paper, Japan's public debt keeps increasing..... because money keeps coming in from the private sector! If the private sector surplus declines, then Japan's public debt will decline as a result.

There's no way for both the public sector (the J government) and the private sector (J households and corporate) to simultaneously run surpluses...it's just not possible in math or logic.... it’s analogous to:

Country A trades with Country B

A has a trade surplus with B

So what must be true based on that fact?

B runs a deficit with A.

J government deficit is basically the flip side of the J private sector surplus.

Finally, have you ever wonder why almost everything on this site (and the media in general) is doom and gloom? Is the world really falling apart? Remember, like everyone in the media business, JT needs advertising to pay its bills, and your attention is the fuel that keeps this gravy train rolling.

-1 ( +0 / -1 )

It is hard to be "sunshine" when all of the jobs are leaving Japan. All the jiji that run Japans corps see is increased profit. So to make extra profit they would sell and or eat their own young. The more jobs leave, the higher the taxes; the more jobs will be lost. It is called depression and all the fools in government want is to pay off the public debt. Taking even more money out of the economy.... What is comedy/tragedy like without hubris? Do you see the sunset now? It is so pretty taking us into the night.

-1 ( +0 / -1 )

1standgoal

I tried to explain herefornow that this JGB numbers are nothing more than a net/sum zero game on Japan's balance sheet but I guess you almost have to draw pictures in order for him/her to understand this simple concept.

But I do agree with herefornow about the weak domestic consumption which is the core problem of Japan. But the difference between Japan and let's say USA is that for a Japanese person, it's whether or not they want to spend 10,000 yen in cash on some product and in U.S., it's whether or not this person want to apply for a new credit card so that they can spend $100 on the same product.

-3 ( +2 / -5 )

@1standgoal

BTW, why are so many folks on this forum so bitter?

I guess the answer to your question is rooted in the fact that living in a foreign country is not so easy and Japan and Japanese culture and way of thinking are definately a challenge to understand and accept. Stress builds up and eventually is released - often on such forums.

-2 ( +0 / -2 )

Back on topic please.

0 ( +0 / -0 )

As whole industries are transferring factories to countries where they can enjoy cheaper labor cost, you cannot expect that the export is going to grow dramatically, meaning you cannot expect too much that the export would help the trade surplus. Early on, before the big quake happened last year, no body realized that our balance bet import and export is so fragile that it could be easily deficit. That is becoming quite serious. I worry slightly that Japan's trade balance continues to be deficit unless the government changes the strategy on sources of electricity from highly-dependent nuclear to green energy.

0 ( +0 / -0 )

YEn is way too strong for too long. BOJ is too sleepy for too long. Japanese exporters are too incompetitive to Korea and Taiwan for too long.

0 ( +0 / -0 )

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