Clark,
Interesting article, and interesting turn of events, if true. I recall last spring on the Asia thread, we were all talking about the yen going to anywhere between 160 and 300 (one brave soul still talks about the inevitability of 300--you know who you are) when it was in the 130s and, briefly, the 140s, and talking about the Big Bang and how it would mean that Japanese people would finally move their money abroad, specifically to the US. Now we're talking about the opposite--the ¥ strengthening from 110 or so, and the Japanese moving back to Japan.
However, it isn't clear to me why that is a great thing for Japan, or that it is true. Hitachi just said that they anticipate for their current period a steeper loss than previously expected because of the strength of the ¥. Back in Sept/Oct., many of Japan's export behemoth's reported steep losses. Nissan, for one, is swimming in debt, and rumors abound about a foreign auto company buying them eventually, although the debt was an inhibiting problem despite their extensive infrastructure. So now the Japanese govt wants a still stronger ¥, which will effectively sink the one sector of their economy which is not moribund? What is the sense in this? I know for sure that I don't understand them, heck I was among those believing that the ¥ would get weaker when it was in the 130s. Maybe someone can explain to me how this latest repatriation move would help them.
Best,
Sam |
