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© (c) Copyright Thomson Reuters 2017.Japan's record FY2018 budget puts fiscal discipline in doubt
By Tetsushi Kajimoto TOKYO©2024 GPlusMedia Inc.
22 Comments
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SaikoPhysco
Really.... Japan's budget and how much it spends is of little concern to anyone! Japan is already $11 Trillion in debt... so whats another few Trillion here and there? At some point, it might be 5, 10, 20, or 50 years from now, the Japanese Government will wink its collective eye to all the domestic holders of its debt and say... forgive it all and lets start over. And a new Japanese National Holiday will be declared.... The Day of Forgiveness.
JeffLee
Why would they? the buyers of Japan's debt is now predominately the Bank of Japan, which returns the coupon payments and principal back to the Finance Ministry. As for other investors, they've long been happy near zero-interest, yield. It's not as if they're expecting any great returns .
SaikoPhysco
@ JeffLee... my point exactly!!! Japan's debt is Debt in name only!
toshiko
Needs too stop me doing money to. any foreign countries. JAPAN FIRST. Stop. buying US debts bond.
toshiko
I meant stop giving money to foreign countries.
kurisupisu
Plenty of money flowing to zombie companies not making profits but losses.
Big bonuses for staff and their companies in the red,bailed out by the banks!
Something will have to give in the end......,.
SaikoPhysco
@ Toshiko... Japan prints money, buys U.S. Government Bonds, and gets precious printed U.S. Dollars in return. Do you really have any clue. Oh no... we Japanese are supporting the USA with our Printed money.... Japan is in more debt that the USA. Both countries would be as bad off as Greece if Germany owned our debt.
bruinfan
Often "conservative" governments (in a nationalist sense) are responsible for some of the biggest government spending in the world.
Disillusioned
Why is the word 'should' used in this statement? It doesn't inspire much confidence, does it? I'd say that Finance Minister Taro also believes in fairies and unicorns.
bluedogsdodge
Just don't give any bonuses to any of them for a few years. They did't earn it anyway. Japan would probably have a surplus after that. But we know that wont happen.
Schopenhauer
It is strange despite Japan's snowballing debts, Japanese currency remains strong. It is different from Greece and other countries where they do not have competitive industries and their national bonds are owned by foreign countries. Also, demographic picture of Japan will change a lot after the aged generation goes away. Bank of Japan and GPIF (Government Pension Investing Fund) are buying Japanese stocks sustaining stock prices. The strong stock price is helping the welfare funds.
Dango bong
Japanj's debt is mostly owed to itself so it is kind of imaginary debt in the sense that they know nobody will be coming to collect.
Hey WTF let's just raise taxes!
SaikoPhysco
I said this years ago.... Japan should continue to print money and buy tangible assets with it. Think about it. If you could buy a piece of land or gold with monopoly money wouldn't you. Japan continues to print the Yen and increase its National Debt but the Yen does not weaken. If I were running the BoJ, I'd print like 50 Trillion Yen and buy Gold, Silver, Stocks in Foreign Companies, Bonds, Buildings in New York and London... anything with good Tangible Value. At some point the Yen would weaken because the rest of the World would be really putting up a stink... but before that happened you might be able to get a $ Trillion or Two under your belt. Use the proceeds from those assets towards the National Budget.
Simon Foston
kurisupisuToday 08:05 am JST
All of which will continue indefinitely if the owners of these companies are relied on by LDP politicians for cash and votes.
fxgai
Japanese fiscal discipline is a joke. Spending 97 trillion against near record revenues of 59 trillion?
Japanese welfare system spending alone could be said to be financed by new debt issuance - 33 trillion yen apiece. Thanks, future generations, for what you will be left to deal with.
Long may the BOJ buy this junk debt... but who the heck would instead if the BOJ ever gets to attempt an exit from their current program before all this comes to a head? Buying JGBs in order to sell them on to the BOJ has been an easy play, but that’s not going to last a lifetime.
Japan needs to think more long term, to get ahead. Imagining that economic growth will suddenly boost near record revenues of 59 trillion to close to a hundred is a joke. That is obviously not going to happen in the absence of serious reforms to the way this country operates, which is not forthcoming from Abe and team.
The best case is that Japan will muddle along for a while yet. Enjoy the short term while it lasts.
Schopenhauer
fxgai
All know about the problems you referred to but they cannot cut the budget then they will lose elections. Democracy spoils people and ruin the country in the end.
fxgai
I believe politicians with some guts could win elections on a platform of reforms if they were honest with people.
The simple message is that things are a mess but if everyone pulls together and accepts necessary changes, there is a brighter future to be had for all. It won’t be easy in the short term as things are adjusted and changes happen in people’s lives, but it is for the better in the long run. Take the horrid medicine and get well soon rather than let the disease drag on.
People like politicians of principle and the courage to do what’s needed.
JeffLee
When you are your own creditor, "coming to collect" is not an issue.
toshiko
Japan should stop buying US debt bonds. China stopped and prospering.
toshiko
Trump flatters Abe to ensure Japan will rend money to almost bankrupted USA.
toshiko
@psycho:
So you did not know yen is not used to buy dollars using debt bonds.
SaikoPhysco
@ Toshiko... so lets see. At 03:47 AM JST... Toshiko had the idea, Japan should stop buying US Debt Bonds. 6 minutes later he though; Trump flatters Abe, and another 5 minutes later... some gibberish about foreign exchange and debt bonds. Toshiko... were you drinking again?