politics

Japan, China, S Korea to skip finance talks amid tensions

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To bring historical problems back to attack other countries is not rational. For us what is important is future. It is silly to spoil the present and the future bringing back the past.

0 ( +4 / -4 )

But China, which serves as chair this year, has informed Japan no meetings need to be held this time since as there were no urgent issue to discuss, the government officials said.

that's great (if true) and what did Skorea say? Anyway, Japan is least concerned since huge sum of $1.3 tril is already in pipeline and Yen is sliding, Nikkei is reaching new highs everyday !

-3 ( +1 / -4 )

Good news. Since ADB has appointed Nakao, Japan deciding to increase currency swap with ASEAN, and Aso basically silenced those whiners who wanted to accuse Japan of currency manipulation during the recent G20, there us nothing to discuss.

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@nigelboyApr. 27, 2013 - 07:34AM JST

Good news. Since ADB has appointed Nakao, Japan deciding to increase currency swap with ASEAN, and Aso basically silenced those whiners who wanted to accuse Japan of currency manipulation during the recent G20, there us nothing to discuss.

You know it is Yen currency manipulation when the average salarymen and pensioners in Japan is hit with lower purchasing power of their fixed income. You don't need to be a Nobel Prize economist to understand that printing vast amount of money, Yen in this case without underlying assets to back it up will manifest itself as a weakened currency= Currency Manipulation for export advantage. Think Zimbabwe as an extreme example. Japan is not the world Reserve Currency like US and does not have the same clout as the Dollar. Export advantage, sure, that is the real motive, but the average Japanese is suffering in silence because of pride, near zero interest rates, but I bet by end of year Abe popularity will sink when the depth of the currency manipulation become intolerable to the masses in Japan. The short honeymoon is about to be over for Abe!

0 ( +5 / -5 )

Tony Ew.

Leave U.S. out of this.

JPY, KRW, CNY. Which one of these are globally recognized hard currency? Thank you.

In 2002, China had M2 of 16 trillion yuan. Now, it's 106 trillion. That's called "bubble".

http://sankei.jp.msn.com/world/news/130425/chn13042509000004-n1.htm

1 ( +6 / -5 )

Tony Ew Apr. 27, 2013 - 07:50AM JST You know it is Yen currency manipulation when the average salarymen and pensioners in Japan is hit with lower purchasing power of their fixed income. You don't need to be a Nobel Prize economist to understand that printing vast amount of money,

Then why don't we see U.S. making it illegal for Japan and other currency manipulators to purchase U.S. Treasury bills and other government assets? But don't you see what a two-way street this is? It is only the U.S. government's reckless spending, and endless need for more buyers of its debt, that supplies the huge level of government assets available. Without the demand for U.S. debt that Japan and China has had over the past decade, there is little chance U.S. would have been able to borrow as freely and cheaply as they have. U.S. is addicted to credit, and Japan, China and others are addicted to exporting and manipulating currencies by supplying that credit and helping finance U.S. consumption. With global levels of debt still terribly high, the currency wars are not about to be over. They are just beginning in earnest.

Sure, U.S. need to increase exports. But it will come with a cost of either higher prices for imports, or a devalued dollar (meaning higher real consumer prices), or a decrease in wages as Germany did (meaning higher real consumer prices). U.S. will have to face a version of austerity in the form of reduced consumption, both public and private, because U.S. ability to consume on the basis of debt (rather than on the basis of production) seems to be approaching its limits.

1 ( +2 / -1 )

@nigelboyApr. 27, 2013 - 08:05AM JST

@sfjp330

Tony Ew.

Leave U.S. out of this.

JPY, KRW, CNY. Which one of these are globally recognized hard currency? Thank you.

In 2002, China had M2 of 16 trillion yuan. Now, it's 106 trillion. That's called "bubble".

http://sankei.jp.msn.com/world/news/130425/chn13042509000004-n1.htm

This is a totally useless piece of information about China. Since you don't live in China, you don't know how the PRC operates. I understand PRC govt is very careful in ensuring the Purchasing Power of basic necessities are not eroded for the masses, but not so for Japan under Abenomics. You can check the news yourself, his policies is biting their pocket books harder and harder! I won't be surprise he will be voted out of office once the average Japanese realise his Yen currency manipulation is a two way street and is going to hurt her citizens big time. Cheering him now, big popularity out of ignorance of the fact that his economic and military policies is going to cost the Japanese taxpayers more money than they can bear!

I have read about poor Japanese and even though Japan is a rich country, the bottom is about to fall off for the average Japanese just like it is on going here in the US. Why leave US out when US is the 'gold standard' for everything? Mother of all currency manipulation that Japan is now mimicking with unlimited Yen printing, so US being a pot cannot call the kettle black, at least not yet, though US had warned Japan recently about the excessively weak yen vs the dollar. See, even US cannot take it anymore!

0 ( +4 / -4 )

and they want to sign a FTA, when do they expect this to happen, in 50 years

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@ sfjp330

I believe the US would welcome Japan, China or any other countries in purchasing its Treasury Bond it is in their interest. Three countries I can name in excessive printing currencies. the US, Japan and UK. all these three countries are piling new debt over existing one. Japan in particular has the highest debt level. Japan current debt servicing accounts for 40% of government receipt. and this is based on a 0.5% treasury bond interest rate and an approximately -0.5% inflation rate. Abe's govt. is targeting a 2% inflation rate now this would mean the treasury bond rate has to rise around 3% for investors to received a real interest rate of 1%. On a debt exceeding 20% of GDP this rate is unsupportable as I already mentioned earlier that the debt to Govt. receipt is already 40% of GDP. The big issue here is If this massive liquidity injection continue will create inflation and head either into a debt default because of unsupportable interest rates or into an uncontrollable spiral where BOJ is the only player in the Bond Market while others are sellers or if to stop the plan in progress and let the economy weakened away thus Abe economy landed a failure as previous governments. Another consequence arise is the possible of Japanese Business Investors worried of the possible falling Yen (created by excessive money printing) would moved its business oversea irrespective whether they are patriotic to Japan. Currently Yen is moving closed to 100 yen to the US dollars and might go even higher.

The principle of printing money(an easy solution and it does not need much brain to do it) is only a last resort but to continue printing excessively like the US and now Japan is inviting trouble in the future.

China is correct in calling off this meeting until a more suitable time when tension is lower, imagine if both China and South Korea in this meeting criticized Janpan for ist currency manipulation the tense atmosphere on top of current issue would be like adding oil to fuel.

1 ( +1 / -0 )

Abe told a parliament committee that South Korea and China were important partners for Japan and he did not want the shrine controversy to become a diplomatic or political issue.

Then don't visit the shrine, and tell your colleagues not to either. And while you're at it, stop issuing denials of Japanese wartime atrocities, and stop these militaristic overtures about changing the constitution and abolishing human rights in Japan in favour of nationalist polity.

Too hard? Then hand over to someone with a better grasp of diplomacy. It will be a diplomatic issue, because Japan appears to be a continual unrepentant oppressor with only a veneer of "pacifism" and an article in its constitution - which Abe is making efforts to overturn - between it and renewed military aggression.

-2 ( +0 / -2 )

This is a totally useless piece of information about China. Since you don't live in China, you don't know how the PRC operates

You're the one who brought up the issue of QE. If the reality of China surprised you, don't go off and try to change the subject.

And again, as usual, people don't grasp the simple concept that 95% domestic ownership of Yen denominated JGB is simply a net sum zero game on Japan's balance sheet.

2 ( +2 / -0 )

@nigelboyApr. 28, 2013 - 03:10AM JST

This is a totally useless piece of information about China. Since you don't live in China, you don't know how the PRC operates

You're the one who brought up the issue of QE. If the reality of China surprised you, don't go off and try to change the subject.

And again, as usual, people don't grasp the simple concept that 95% domestic ownership of Yen denominated JGB is simply a net sum zero game on Japan's balance sheet.

We know that Nigelboy. One day the bond holders in Japan will wake up and see their LDP led govt had string them along for so long, vote getting gimmick, and will be shocked that they cannot have their principals paid back. Maybe just the interest/dividend but if it become too onerous, there will be hint of 'buy this bridge, road, parks, hospitals' etc and we'll throw in your names for these assets. In other words it is just an internal transfer of ownership from one Japanese entity (govt) to the private citizens.

So those rich Japanese who lent to the govt cannot really cash out and take the money and spend elsewhere. It had already being sunk into those fixed assets as mentioned above. That's why Japan is so developed, it is all paid for, by the bondholders, majority of them Japanese themselves, but their money is not liquid and this is one of the reason the US credit rating agencies downgraded Japanese debts.

China is right to cancel the talks now because there is nothing to talk at this stage while Japan is committed to printing unlimited yen. There is really nothing to talk when Japan is inflexible.

-1 ( +0 / -1 )

We know that Nigelboy. One day the bond holders in Japan will wake up and see their LDP led govt had string them along for so long, vote getting gimmick, and will be shocked that they cannot have their principals paid back. Maybe just the interest/dividend but if it become too onerous, there will be hint of 'buy this bridge, road, parks, hospitals' etc and we'll throw in your names for these assets. In other words it is just an internal transfer of ownership from one Japanese entity (govt) to the private citizens.

Sigh. Some people still just don't get it. Default??? Back a decade ago, people were citing the same thing when when the ratio exceeded 100%. Now, it's well over 200% and yet the rates are still low. The very same people in 2002 are saying the same thing in 2013.

http://www.japantoday.com/category/politics/view/politics-pushes-japan-toward-fiscal-cliff

Discussed in length above.

Net/sum zero game with Japan being the largest creditor for 20 consecutive years.

3 ( +3 / -0 )

@nigelboy

Sigh. Some people still just don't get it. Default??? Back a decade ago, people were citing the same thing when when the ratio exceeded 100%. Now, it's well over 200% and yet the rates are still low. The very same people in 2002 are saying the same thing in 2013. http://www.japantoday.com/category/politics/view/politics-pushes-japan-toward-fiscal-cliff Discussed in length above. Net/sum zero game with Japan being the largest creditor for 20 consecutive years.

If I were you, I would be very humble and just leave it to the expert Credit Rating Agencies. Japan had already being downgraded but it is up to the Japanese people to trigger a meltdown which the credit rating agencies have no certainty will occur given this is a monolithic society that operates differently from typical free market forces. I also want to add that Abe is playing the last available card by arm twisting the BOJ to print unlimited yen which mask the J govt creditworthiness.

The agencies have better insight into the various metrics and human psychology at play and draw on historical events. I just say that this is unchartered territory and just like an untested rubber band, you won't know when it will break until it actually break. Enough said!

-2 ( +0 / -2 )

If I were you, I would be very humble and just leave it to the expert Credit Rating Agencies. Japan had already being downgraded but it is up to the Japanese people to trigger a meltdown which the credit rating agencies have no certainty will occur given this is a monolithic society that operates differently from typical free market forces. I also want to add that Abe is playing the last available card by arm twisting the BOJ to print unlimited yen which mask the J govt creditworthiness.

Lot of good that did to Lehman. Is this all you have?

2 ( +2 / -0 )

"Abe told a parliament committee that South Korea and China were important partners for Japan and he did not want the shrine controversy to become a diplomatic or political issue."

The PM knew perfectly what these countries' reactions would be...contradictory remarks on and on started to make a dent in the credibility of J politics in the international political history. Funny man.

0 ( +0 / -0 )

Question is, why in the world do Japanese polticians have to bring freaking news reporters/journalists to their visit to Y. Shrine? Can't they visit them in private manner? After all, isn't Shrine a sacred place?

-2 ( +0 / -2 )

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