Tag Archives: Japan

The Japanese economy shrank -7,8 percent in Q2 and that is the steepest decline ever

The Japanese economy shrank -7,8 percent in Q2 and that is the steepest decline ever. This was the third straight quarter of contraction which means Japan is in a deep recession amid the severe impact of the COVID-19 crisis.

Private consumption fell -8,2 percent vs -0,8 percent in Q1. Exports plummet -18,5 percent which is the most since Q1 2009. The economy collapsed 27,8 percent in the June quarter, and that is the deepest on record.

Japan was the tech darling in the 80`s. Their consumer electronics industry was once considered the strongest in the world. But now the tech giant is in a state of decline as consumption arises in countries like China, the United States, and South Korea.

However, video gaming in Japan remains a major industry. Japan became a major exporter of video games during the golden age of arcade video games, an era that began with the release of Taito`s Space Invaders in 1978 and ended around the mid-1980s.

Japan dominated the industry until Microsoft`s Xbox consoles began challenging Sony and Nintendo in the 2000s. That being said; Japan is now the world`s largest market for mobile games.

Japan`s strong economic growth ended with a big crash in the late ’80s and early ’90s. In the late 1980s, abnormalities within the Japanese economic system had fueled a speculative asset price bubble of a massive scale.

The bubble was caused by the excessive loan growth mechanism known as the «window guidance». As economist Paul Krugman explained; «Japan`s banks lent more, with less regard for quality of the borrower, than anyonw else`s. In doing so they helped inflate the bubble economy to grotesque proportions.»

Trying to deflate speculation and keep inflation in check, the Bank of Japan sharply raised inter-bank lending rates in late 1989. This sharp policy caused the bursting of the bubble and the Japanese stock market crashed.

Equity and asset prices fell, leaving overly leveraged Japanese banks and insurance companies with books full of bad debt. The financial institutions were bailed out through capital infusions from the government, loans and cheap credit from the central bank, and the ability to postpone the recognition of losses, ultimately turning them into zombie banks.

The Japanese asset price bubble was an economic bubble in Japan from 1986 to 1991 in which real estate and stock market prices were greatly inflated. In early 1992, this price bubble burst and Japan`s economy stagnated.

The bubble was characterized by the rapid acceleration of asset prices and overheated economic activity, as well as uncontrolled money supply and credit expansion. More specifically, over-confidence and speculation regarding asset and stock prices were closely associated with excessive monetary easing policy at the time.

As a result of all this mess, Japan started to «print money» like never before, and now Japan recorded a government debt equivalent to 236,60 percent of the country`s GDP in 2019. Someone has to pay for this, but who? The people of course.

The Personal Income Tax Rate in Japan stands at 55,95 percent, which means more than half of the people`s hard-earned money goes to the Government in Japan. On top of that; their interest rate is negative at -0,1 percent which means people have to pay money to the bank and not otherwise if they have money stored in the bank account.

Policymakers noted that the outlook for economic activity and prices are extremely unclear, depending on the consequences of the virus and the magnitude of their impacts on domestic and overseas economics.

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Disclaimer: The views expressed in this article are those of the author and may not reflect those of Shiny bull. The author has made every effort to ensure the accuracy of the information provided; however, neither Shiny bull nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in precious metal products, commodities, securities, or other financial instruments. Shiny bull and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.

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Taiwan officially known as Republic of China has been self-ruled since 1950, but China considers Taiwan part of its land that must be reunited with mainland even by force

Tsai-Ing-Wen and the Democratic Progressive Party has won a historic landslide victory in the Taiwan election. They defeated the much more Pro China rival Han Kuo-Yu and the KMT. This is a big surprise and no one would have expected this outcome a year ago.

This is a clear message to the one rule Communist Party in Beijing. The people in Taiwan rejects China`s plan for reunification with the island. It`s a remarkable turnaround for the president, whose party suffered major losses in local elections just a year ago.

I believe that the rise of the party started when Pro Democracy protesters in Hong Kong took to the streets last year. People are more awake today than only a few months ago. Months of ant-govenment protests in nearby Hong Kong boosted Wen`s campaign, and scenes of police cracking down on demonstrators appear to have galvanised younger voters.

Tsai warned that Taiwan`s democratic rights must be preserved, and the country has its own military, currency and a passport accepted in most countries. But, Taiwan does not have a seat at the United Nations, and only 15 countries officially recognise Taiwan`s democratic government. United States is not one of them.

Tsai said that the people in Taiwan reject the one country, two systems model. We respect democracy and our sovereign rights, she said. Huh, it sounds like Trump who is fighting against the globalists in Europe.

On the other side; Washington is Taiwan`s most important ally and trading partner. It will be interesting to see how far the U.S will go to defend Taiwan and what will Xi and the Communists in Beijing do in respond to Tsai Ing-Wen`s win, which gives her a second term in office? The Communists have ramped up pressure on Taiwan and cut off official communication with Tsai in the past.

Tsai Ing-Wen said peace means that China must abondon threats of force against Taiwan. She also said she hope Beijing understands that democratic Taiwan will not concede to threats. China says it will not change position that Taiwan is part of it after Tsai`s re-election.

China claims Taiwan is part of its territory under its “One China Principle”.

We now see a similar situation in Taiwan is it is in Hong Kong. One Country, two systems. Taiwan, officially the Republic of China (ROC), is a state in East Asia.

Taiwanese indigenous peoples settled the island of Taiwan around 6,000 years ago. In the 17th century, Dutch rule opened the island to mass Han immigration. After the brief Kingdom of Tungning in parts of the southern and western areas of the island, the island was annexed in 1683 by the Qing dynastry of China, and ceded to the Empire of Japan in 1895.

Following the surrender of Japan in 1945, the Republic of China, which had overthrown and succeeded the Qing in 1911, took control of Taiwan on behalf of thw World War II Allies.

The resumption of the Chinese Civil War led to the loss of the mainland to the Communist Party of China (CPP) and the flight of the ROC government to Taiwan in 1949. although the ROC government continued to claim to be the legitimate representative of China, since 1950 its effective jurisdiction has been limited to Taiwan and numerous smaller islands.

In the early 1960`s, Taiwan entered a period of rapid economic growth and industrialisation called the «Taiwan Miracle». In the late 1980`s and early 1990`s, the ROC transitioned from a one-party military dictatorship to a multi-party democracy with a semi-presidential system.

Taiwan`s export-oriented industrial economy is the 21st-largest in the world, with major contributions from steel, machinery, electronics and chemicals manufacturing. Taiwan is a developed country, ranking 15th in GDP per capita. It is ranked highly in terms of political and civil liberties, education, health care and human developments.

The political status of Taiwan remains uncertain.

The ROC is no longer a member of the UN, having been replaced by the PRC in 1971. Taiwan is claimed by the PRC, which refuses diplomatic relations with countries that recognise the ROC. International organisations in which the PRC participates either refuses to grant membership to Taiwan or allow it to particitpate only on a non-state basis.

Taiwan is a member of the World Trade Organization, Asia-Pacific Economic Cooperation and Asian Development Bank under various offices and institutions that function as de facto embassies and consulates.

Domesticay, the major political division is between parties fvouring eventual Chinese unification and promoting a Chinese identity contrasted with those aspiring to independence and promoting Taiwanese identity, although both sides have moderated their positions to broaden their appeal.

Taiwan officially known as Republic of China has been self-ruled since 1950, but China considers Taiwan part of its land that must be reunited with mainland even by force.

The U.S hailed Tsai`s victory as demonstration of Taiwan`s robust Democratic system. Taiwan`s president Tsai Ing-Wen secures second term in office with 57,1% of votes. The vote is seen as a choice between moving closer to China or resisting push for reunification.

Tsai Ing-Wen told the supporters “today we have defended our democracy and freedom”.

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Will investors lift Lyft?

Investors are jumping into the market again and some say you must buy the dip. Can investors lift the Lyft stock to a higher level? Lyft is expected to report earnings on Wednesday 8 after market close.

The company is scheduled to announce Q2 earnings results on Wednesday and EPS Estimate is -$1,66 and the consensus Revenue Estimate is $809,64M. The history of the company is short and so are the company itself. Lyft was founded 7 years ago as Zimride in San Fransico, California.

General Motors is one of the biggest owners with a 6,6% stake but the biggest owner is Rakuten with a 11% stake. Rakuten is a Japanese electronic commerce and internet company based in Tokyo. Its e-commerce platform Rakuten Ichiba is the largest e-commerce site in Japan and among the world`s largest by sales.

Lyft are operating in 640 cities in the U.S and 9 cities in Canada. It develops, markets, and operates the Lyft mobile app, offering car rides, scooters, and a bicycle-sharing system. Lyft is the second-largest TNC with a 28% markets share in the U.S, according to Second Measure.

Disclaimer: The views expressed in this article are those of the author and may not reflect those of Shiny bull. The author has made every effort to ensure accuracy of information provided; however, neither Shiny bull nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in precious metal products, commodities, securities or other financial instruments. Shiny bull and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.

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Japan`s Megabanks are up about 50% since the election

This week is a week for a special focus on the banks around the world. Today, I will take a closer look at the banks in Japan.

Japans interest rate peaked in the 70s and 80`s at about 9%, and it went down to 6% in 1991. Then it started to fall down with the stock market. As you may know, Japan has printed tons of money and a great recovery has never happened.

 

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Japan are in a very special situation. The Bank of Japan left the interest rate unchanged at -0,1% at its December 2016 meeting, as widely expected. In addition; policy makers also decided to maintain its 10-years government bond yield target around 0% and viewed a moderate recovery trend in the economy had continued while exports has picked up.

With regard to the amount of JGB`s to be purchased, the Bank will conduct buying at more or less the current pace. An annual pace of increase of about 80 trillion yen.

The biggest banks in Japan are up about 50% since the election.

On top of all this, Japan will continue with its craziness and monetize about $670 billion`s worth of bonds per year.Wow!

Japan`s economy has continued its moderate recovery trend, and overseas economics have continued to grow at moderate pace, although emerging economies remain sluggish in part. In this situation exports have picked up.

Prime Minister Shinzo Abe said the sales for American cars are poor, pushing back after President Donald Trump described the trade imbalance on vehicles as «unfair». Japan exported 1,6 million cars in 2015. Sales of American cars in Japan are almost non-existent, while only 19 000 cars were sold in Japan in 2015, trade minister Hiroshige Seko said.

The reason for the bad sale is competition and not tariff.

Despite all the noise from the U.S and Trump`s fiscal and trade policies, and a number of unclear factors like Brexit, trade deals and the global economic situation, Japan will see its economy grow in 2017 on the back of the weak yen and government steps to stimulate sluggish consumption, economists have said.

They predict that 2017 will be a positive year for Japan, and the government looks to craft more measures to help boost consumption.

A weaker yen against the dollar will also help boost Japanese exporters and their revenue.

Shinzo Abe will meet Donald Trump in Washington 10 February this year.

 

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Disclaimer: The views expressed in this article are those of the author and may not reflect those of Shiny bull. The author has made every effort to ensure accuracy of information provided; however, neither Shiny bull nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in precious metal products, commodities, securities or other financial instruments. Shiny bull and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.

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What is the most dangerous war?

The new film San Andreas cracked well over $60M mark internationally this weekend to help boost its worldwide come to $118,5M, just in front of its China bow tomorrow. This is business for Warner Bros./Village Roadshow.

The film which stars Dwayne «The Rock» Johnson, knocked last week`s top film Tomorrowland, which debuted with $40,7M. Earthquake disaster movie San Andreas has topped the US box office over the weekend, allaying fears that audiences in quake-prone regions would avoid seeing it.

It is registered a little earthquake in Northern California about three hours ago, but it was just a little one (2,4). The biggest today is seen in North of Svalbard (5,1). A magnitude -7,8 earthquake struck off the southern coast of Japan on Saturday, shaking buildings in Tokyo and interrupting subway service, but causing no major damage or injuries.

If you haven`t seen the film yet, take a look at the official trailer below.

 

 

What`s worse than the nature being angry like an earthquake or a volcano? What about an asteroid? We are in big trouble if one of these giant rocks ends up on a collision course with Earth. What about a war? A World War III? Made by human beings.

We can solve a problem by diplomatic solution, but we can`t deal with an asteroid. We can`t deal with a volcano. Neither an earthquake.

We can stop a World War III, but not a big rock from space.

Former NSA intelligence analyst John Schindler said last week that a senior NATO official told him that the world would «probably be at war» sometime this summer. He is not alone to say so. The investor legend George Soros warned that we «are on the threshold of a Third World War.»

John Schindler`s tweet was retweeted more than 1,000 times, but no one in the media covered it. Soros said in remarks at a Bretton Woods conference at the World Bank that a trigger for a global military conflict can start as China`s economy slows down.

«If there is a military conflict between China and an alley of the U.S, like Japan, it is not an exaggeration to say we could be on the threshold of a Third World War. It could spread to the Middle East, then Europe and Africa.»

Soros called on the U.S to make a «major concession» and allow China`s currency to join the International Monetary Fund`s basket of currencies. Yuan will then be a rival to the dollar as a global reserve currency.

If so, China would have to make similar major concessions to reform its economy, such as accepting the rule of law, and an agreement along these lines will be difficult to achieve, but the alternative is a brutal war, Soros said.

«Without it, there is a real danger that China will align itself with Russia politically and military, and then the threat of third world war becomes real, so it is worth trying.»

This comes in a time when Europe engages in some of its biggest ever war games near Russia. If the War starts, it will be multi faceted and poses risks to markets. Modern warfare would involve many facets including cyber warfare and currency war.

Around a million asteroids are located between Mars and Jupiter in the «asteroid belt.» The craters on the Moon were formed by asteroids and some think it was an asteroid that wiped out the dinosaurs. The human beings survived. What can wipe out the humans on this planet?

«If we`re lucky it won`t be nuclear,» Schindler said in his tweet last week.

 


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Disclaimer: The views expressed in this article are those of the author and may not reflect those of Shiny bull. The author has made every effort to ensure accuracy of information provided; however, neither Shiny bull nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in precious metal products, commodities, securities or other financial instruments. Shiny bull and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication. UA-63539824-1.

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