http://globaleconomicanalysis.blogspot.com/2013/03/japan-machinery-orders-fall-13-median.html
Monday, March 11, 2013 8:08 PM
Japan Machinery Orders Fall 13%, Median Expectation Was 1.7% Decline
Bloomberg reports Japan Machinery Orders Fall 13% in Sign of Limits on Investment.
The decline from the previous month, announced by the Cabinet Office today in Tokyo, compared with the median estimate in a Bloomberg News survey of 26 economists for a 1.7 percent fall.I understand the caution about volatility of large orders, but the rest of what Devalier says is suspect.
Today’s data are a reminder that business investment will not drive the recovery, said Izumi Devalier, a Japan economist at HSBC Holdings Plc in Hong Kong.
“Looking ahead, we expect accelerating consumption, residential and public investment,” Devalier said. Devalier cautioned against reading too much into a single month of “very volatile” data.
Have demographics suddenly changed? The answer to that question is clearly "no", so what reason is there to believe residential investment will be on the rise?
What about public investment? Japan has a debt-to-GDP ratio approaching 250%, and that is the highest ratio of all developed nations. Japan achieved that dubious distinction because it squandered money on "public investment".
Since stupidity often strikes multiple times, I would not totally rule out a surge in public investment, however, I rather doubt it's coming. Recall that Japan's government currently seeks massive tax hikes to pay for what it has already squandered. Moreover, Japanese citizens do not want those hikes. Would they stand for more hikes for more bridges to nowhere?
Accelerating consumer consumption? Why?
I suspect Devalier believes Keynesian claptrap that rising prices are a good thing, but I beg to differ. People do not in general buy things just because the price is going up (there is only so much space to store things). Nor do people avoid buying things simply because prices are falling. If the latter was the case, no one would have bought a computer or a flat screen TV for years.
If Japan gets the price inflation it seeks, but exports do not rise enough to pay for rising energy costs, Japanese savers will be royally screwed (but the stock market may do well, especially in nominal terms).
Stock market aside, this is a very dangerous situation Japan is in, and for the nation as a whole, it's highly likely to end badly.
Mike "Mish" Shedlock
and....
http://www.zerohedge.com/news/2013-03-09/china-japan-hand-over-senkakus-or-your-economy-gets-it
China To Japan: Hand Over The Senkakus Or Your Economy Gets It
Chinese Foreign Minister Yang Jiechi said Saturday that "Japan needs to face up to reality, and take real steps to correct its mistakes... so as to prevent a further escalation," with regard the demand that Japan reverse its nationalization of the small islet chain of the Senkakus. In some of the strongest rhetoric yet, The Japan Times reports that the Chinese minister said Japan's 'single-handed' actions so far have "caused great damage to China-Japan relations and undermined stability in the region," and urged Tokyo to "make concrete efforts" to prevent fraught bilateral ties from spiraling out of control. As the reigns of control in China continue to be handed over (with Yang expected to become state Councillor for foreign affairs), we suspect the situation is far from resolved - especially with Shinzo Abe fighting a war on another front (that China is likely not pleased with either).
CNY-JPY exchange rate has devalued 28% in the last 6 months with the Yuan at its strongest against the Yen in 5 years...
Via The Japan Times,
Japan and China should just duke it out in a baseball fight for the Islands...... would cost less , fan appeal , winner gets the rocks.....China on Saturday demanded that Japan reverse its nationalization of the Senkakusand address the sovereignty dispute through negotiations, urging Tokyo to “make concrete efforts” to prevent fraught bilateral ties from spiralling out of control.Chinese Foreign Minister Yang Jiechi said the sharp deterioration in Sino-Japanese relations was“single-handedly” caused by Japan’s purchase last September of three of the main Senkaku islets, and accused Tokyo of “illegally” seizing and occupying what he termed Chinese territory. The islet group in the East China Sea is administered by Japan but has been claimed by China since the 1970s.“The Chinese side believes that Japan needs to face up to reality, take real steps to correct its mistakes and work with us to handle and resolve relevant issues through dialogue and consultations, so as to prevent a further escalation of the situation and stop it getting out of control,” Yang said on the sidelines of the National People’s Congress in Beijing.Speaking at a news conference, Yang denounced Japan’s Sept. 11 purchase of the Senkaku islets of Uotsuri, Kitakojima and Minamikojima from a Saitama businessman, which effectively nationalized the entire chain, saying the move has “caused great damage to China-Japan relations and undermined stability in the region.”...While censuring Japan for its acquisition of the islets, Yang said that developing “long-term, sound and steady (bilateral) relations” serves “the fundamental interests” of both countries and their people. “TheChinese side is ready to continue to develop a strategic relationship of mutual benefit with Japan,” he said....
No comments:
Post a Comment