Comments on: Strong YEN, Weak Economy

By: kirin

kirin — Thu, 10 Dec 2009 14:02:08 +0000

Thank you for your long comment, Troo. And thank you for spliting your comments as the system doesn't accept long one.

I heard things were very expensive in the U.K a few years ago, before the sub-prime or the economic crisis. But 420 yen for a pair of jeans? OMG!! (*_*) Japanese banks were not very much involved in sub-prime issue, yet the world-wide economic crisis hit our stock exchange market and economy, too, and I thought strong Yen doen't mean strong economy, it's just something relatevely happening when cross-Yen currencies go weak.

Before sub-prime, Yen carry trade was very popular in Japan, at forex. Sell JPY, buy AUS dollars, and receive difference of interests daily. But since Yen surged, due to sub-prime issue, many forex investers had to order stop-loss.

By: Troo

Troo — Tue, 08 Dec 2009 16:46:20 +0000

The Yen is also, sadly, suffering from the greed of global consumers who want to borrow, live in debt, and own more than they can afford. Because Japanese banks were extremely sensible and didn't fall into this whole sub-prime lending nonsense, they're now in very good financial health. This means the Yen is incredibly strong in spite of Japan's otherwise weak economy because the banks themselves are in plenty of credit. It also means that the Yen's currently seen as a safe, stable currency, so forex traders and investors are buying lots of it – and as we all know, when something sells like hot cakes the price goes up

I hope that helps clear things up a little.

By: Troo

Troo — Tue, 08 Dec 2009 16:46:13 +0000

This, in turn, is one of the many factors in China constantly devaluing the renminbi (yuan) – doing so keeps foreign retailers coming back to Chinese manufacturers time and again. The knock-on effect of this is that other exporters suffer because consumers want cheap goods and care little for the ethics of their production – I witnessed one interview with some teenagers shoping in Primark, and the interviewer asked them whether they minded that the clothes they'd bought were lovingly handcrafted by children in Chinese sweatshops working 12 hour days, and the flippant reply was "I don't care, just so long as I get clothes cheap".

By: Troo

Troo — Tue, 08 Dec 2009 16:46:00 +0000

Low prices are available in most first-world countries. Supermarkets or low-quality stores (e.g. Primark, Matalan) in the UK sell pairs of jeans for just £3 (about 420円), the average price in high street stores for better quality is between £10 – £30 (about 1,400円 to 4,200円), and you can easily spend £150 (about 21,000円) on a designer pair if you so desire.

I think it's less a sign of a weak economy and more a symptom of consumer demand. Certainly in the UK the past decade or so has led to a generation of teens and young adults who want cheap, near-disposeable clothing because they wish to be seen as fashionable. Some have even taken on board the idea that they never wish to wear the same item of clothing twice. This is wasteful and selfish to say the least, but retailers have leaped onto the low-price, low-profit margin, high-turnover bandwagon.

By: kirin

kirin — Sat, 05 Dec 2009 01:22:13 +0000

Inside Japan you feel cheap, but if you exchange for your currency, you'd feel expensive. 1 AUS dollar recorded over 100 yen while ago, which was of course before the economic crisis in 2008, and now it's 80 yen or something. You get 20 yen less per 1 AUS dollar when you exchange your AUS dollar to JPY.

That's one of the reasons I went to Sydney and some European countries in the summer of this year. Thanks to strong yen, I didn't have to spend as much as money that I would have had to spend in 2007 or early 2008.

By: kirin

kirin — Sat, 05 Dec 2009 01:15:27 +0000

I know now is good time for sending money to my bank account in the U.S or other countries. Especially AUS dollar is promising! :p

By: cin

cin — Fri, 04 Dec 2009 07:37:05 +0000

Seeing it from a tourist point of view, this price drop is AWESOME!
But at the same time it is worrying for the businesses and workers over there. I know when the global economic crisis was on the high, so many people got laid-off their jobs and companies went bankrupted. I am still a student so i wouldn't understand how it feels like just yet but soon I will be in the workplace~

By: Eric C

Eric C — Thu, 03 Dec 2009 20:08:28 +0000

Sorry if you didn't understand what I meant. I often word things funny.

This gave me an idea. If you wanted to, because the Japanese Yen is still strong, could you trade the yen for another currency to hold on to until the Yen's value goes down? What I mean is you could exchange it for another currency that is typically strong so later on you could exchange it back for more Yen.
Of course, by doing that, you would have to ensure you have some money now, but it is a way of making money for the future.

As for what you said, you are right that it costs less for you to import things. I would see that as one advantage, but it depends how you look at it.

Either way, the site is a good way for me to see some aspects of Japanese culture.

By: kirin

kirin — Thu, 03 Dec 2009 14:44:33 +0000

こんにちは。(In written way, we usually write it in this way.)
I'm sorry I was not sure for what you meant. (Sorry my English is not perfect. My mother language is Japanese.)
It looks like usually weak USD leads to strong Yen and high price of gold. Strong Yen hits Japanese stock exchange market because our market is supported by many of big exporting companies like Toyota. Strong Yen is a big damage to such companies and to those who work there. That's the story usually spoken on TV. But on the other hand, strong Yen allows import less expensively and so many items including foods that we import from foreign countries go cheaper, which as a result, makes our life easier.
We've been living with 0% interest rate for over 10 years. But U.S. economy went strange only since subprime loan problem a few years ago, right?

If you can read things in Japanese, that's the best thing. I found there are less native Japanese people who blog in English, and that was another motivation for me to do this for my audience.

By: kirin

kirin — Thu, 03 Dec 2009 14:18:39 +0000

I know what you mean. And that's why many of Japanese people still suffer from learning English, I guess. "This is a pen." is the first English sentence that I learned in school. I wonder why it cannot be "Hi, how are you doing?" or "How is it going?" or even "What's up?" This is a pen, which is too obvious to be told! (LOL) Whatever…good luck for your exam!! XD