Japan has been mired in deflation and an economy plagued by a low velocity of money for over a decade. The Lehman collapse of 2008 exacerbated this by causing global mayhem of stock markets, including the Nikkei225 which collapsed from 18000 to 7000 in 12 months, destroying massive Japanese wealth. A rush to the safe haven status of the yen and the subsequent (necessary) money printing by the US Fed created a shift in yen from 124 to 76 yen (USD money supply versus the yen increased by approximately 2 to 1). The BOJ has now begun to increase the money supply which will naturally decrease the value of the yen. The Abe Government is endeavouring to increase the velocity of money and the eventual move out of deflation by improving conditions for investment, spending and induce increases in salaries/bonuses.
Abenomics is a three pronged proactive attempt to jump start the Japanese economy into one which grows with demand-pull inflation. The Government is still virtually in a planning phase, it takes years before specific decisions by the Government and subsequent corporate activities to take real effect through the economy even though there have been positive side-effects from the Nikkei rising, the weaker yen and the simple appeasement for the need for change. Give the Government a chance, the match is only in its first innings.
Early to judge, the need for criticism.
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Interesting how the falling Nikkei draws out the doomsdayers and now the stronger yen adds to their cheers. If the yen weakened to ,say, 130 then the same doomsdayers would be screaming the massive dumping of JGBs , yen becoming toilet paper and the Government going broke .The correct "result" for a disaster heading Japan and what could be concluded as a failing of Abenomics is a combination of falling Japanese corporate earnings; an increase in long term JGBs to interest rates way above 2% (the ceiling for the last 10 years) and a severe weakening of yen/USD.
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This article is about misallocation of Government budgeted funds and not money donated from other countries. Biased people will interpret facts the way they want.
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Impressive, an extraordinary skill to be able to empirically compare kids(?), family (?), and happiness between two different countries.
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Japan is a capitalist country. Therefore its not the Government but companies that determine whether or not salaries and bonuses go up, the core component of the well-being of Japan's future . Abe and the incumbent Government are trying to provide fiscal, monetary and structural reform (remove business impediments) to help Japanese and foreign businesses to invest more and improve performance which won't happen overnight. They are providing the fertilizer for the ferns to grow. Abe's speech today was lackluster at best.
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Demand driven inflation is what the Japanese Government is trying to create. There is no rainbow without the rain. Abe and Kuroda have had less than six months to "have a go". With over a decade of stubborn deflation and low growth, the expectation of an "instant ramen" result to this problem is ignorance at best. Although economics can be subjective for the most part, at the very least, give a chance for the J-Curve effect to work its way through the Japanese economy.
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A specifically troubled sector with enforced higher dependency on imported carbon fuel costs magnified by the weakness of the yen. Equating a salary cut in the energy industry right now with a failure in "Abenomics" is plain convenient selective bias and a very shallow understanding of what the current Japanese Government is attempting to do.
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