CORRECTION: In the original video, we twice confused GDP for the national budget. We have edited the video to fix this - if it's still wrong when you're watching it, it'll be because the new version is being uploaded, and so hopefully fixed soon. Also, at 3:38, the graph says 2021 when it should be 2024. Apologies for these errors, and we hope you nonetheless enjoyed the vid!
Deflation is Good thing, economy should serve people, not exploit people. Inflation is exploitation of people it steals people purchasing power and it goal is generate government a revenue by forcing people to consume. Deflation is much better. If person has saved up money, money value increases and person can wait to spend it when he gets best value about of it. Inföation focuses consumerist attitude, Deflation only reason to consume is if person really needs something then they buy. In deflation economy small businesses can survive, but corporations struggle. in Inflation, small business struggle but corporations strive.
@@Aubrey2004-j4k Actually i undrestand quite bit. The problem is people are so stuck with kaynesian economics that they have forgotten that the economics landscape was a lot more diverse a few hundred years ago. Few thousands years ago even more so. Deflationary economy is only threat to governments and those who depend on governments. Normal ambitious people will be quite happy. There is always some comment. But "who will build roads". This means people are not educated economically but only indoctrinated on Kaynesian economics. You are not first to accuse that I don't know how economy works, I actually understand about 20 different economic concepts and how they work.
Yeah, this channel has zero credibility. They dont understand math, they never mention population declines when discussing Japan’s challenges, and they constantly shill for education apps. Zero credibility
Japan printed 1 trillion out of thin air but nothing happens no imf/world bank but others are forced in to bankruptcy and sell their assets shows you this a corrupt financial system that only benefit few countries
@@denizaydemir6756maybe, but the point is that this channel struggles with basic facts. Where did they mention that japan’s population has been declining for decades? Nowhere. They are clueless.
@@lawjef Population has only been declining since 2008. I'm pretty sure most people know that Japan's population is at least stagnant if not declining.
@jacobmalecki He has full support to pass whatsoever he wants if he does public votes, and he succeeded in all of these bills, and it made Argentinians be in 52% poverty line.
You cant print your way out of there not being any competition for labour. If the culture shames a worker for leaving their company for a better wage, the natural allocation of human capital and expertise is left unaccomplished or unrewarded. You cant have a thriving economy if people with higher skills arent funneled into the places where they can be the most productive (and demand the highest wage).
@@bicin4k Because Unions can negotiate better working conditions. We all KNOW how bad Japan's workaholic culture is, to a point where it's seriously a detriment to Japanese productivity. Like yeah, you're right, the average Japanese worker ISN'T part of a labour union, but this is a hypothetical scenario where unions actually HAVE that sort of power/influence. It doesn't need to confine to reality perfectly, it just has to be realistic enough to be a valid scenario. Which it is. It's unlikely, but it's realistic.
@@bicin4k Well Japan's tremendous growth in the cold war was fuelled by high internal consumption which was made possible by powerful trade unions keeping wages high. It could be a step in the right direction.
Hey, stop it...this channel is known for it's fact checking....*spits out juice in laughter*...nah, you're right. This channel is routinely behind in basic fact checking.
Back then Japanese people blamed everything on 'lazy millennials'. Now it's gen z gertting blamed. It won't happen to gen alpha though. Can't be blamed if nobody is around no more.
"work harder" "THEIR just lazy" Mega-corps talking points doesn't work when talking about Japan workaholic culture. Shifting the blame for who's really at fault the 👉COMPANIES👈 into anybody/anything else and people keep falling for this PSYOP
Permanent resident here. Until about two years ago the stagnant economy was fine. Not great, but prices and wages had stayed the same for 20 years, so not terrible, either. Inflation may be something like 2% on the books, but it feels like a hell of a lot more, and I suspect some aspect of inflation or plummeting, sorry, I meant PLUMMETING yen is not being captured. Mood has gone from a sullen sort of disenchantment with the government to deepening anger. Unfortunately, the right will capitalize on it.
So I don’t know why western videos hardly mention the 1985 plaza accords, where America strong armed Japan into increasing the value of its yen because US industries like auto were being beaten. Exports suffered greatly, Japan responded with loose monetary policy to make up for it, and it led to a run away asset bubble that Japan still hasn’t recovered from. It’s like y’all want to gloss over that, and say Japan just magically fell off of its trajectory.
Sigh...when will economists realize that natural deflation isn't detrimental to the economy just like natural inflation. Keep going Japan. Let the world watch how small groups of people can keep dialing the economic knobs to fine tune an economy into the future better than the free market itself.
You are missing the reason why the 1.3 million cap on part time workers affects working mothers most, putting the cap at 1.8 million is actually encouraging mothers to work more and allow companies to pay more. The current issue is that mothers want to stay under 1.3 million to avoid being forced to pay social insurance individually instead of being covered by the husband’s social insurance. This should actually allow for more net income for these households. It should make a difference in household spending.
@@jonathanodude6660that is the cap they’re talking about - the minimum threshold at which you pay taxes mentioned in the video is the same as a cap on the income you can have without paying taxes. It’s just rephrased.
Also Abenomics proves it isn't just 'money printer go brrrrrrr' that is the sole cause of high inflation. Abenomics was 'money printer go brrrrrrrr' long before you heard of it.
@@aliemreazgn3634 The video states that they are now trying to reduce inflation that was sitting at 4% after Abenomics. Even if the money supply grew more than inflation, inflation still grew by a lot (from deflation to inflation that is considered unhealthy) - becouse of the money printer. Also, economic results always arrive later than policy - so if inflation spiked after Abenomics stopped, it was still coused by Abenomics.
@ShadowNinja69 nope, today's inflation is way after QE and mostly caused by global inflation surge, rising energy prices and disturbed supply lines after Corona virus. Still, no relation whatsoever.
The problem with the Japanese government is it has an addiction to debt. A debt level in excess of 250% debt to GDP is massive. The result is that debt spending has a reduced impact on GDP. Such a massive level of debt also reduced its capacity to counter a downturn. Second, the BOJ has had rates at an emergency crisis level of below 2% for multiple decades. Such low interest rates may seem to be beneficial, but they exact a number of costs. First, they allow governments to overspend, which is obviously the case in Japan with the massive level of government debt. Raising rates forces governments to be more fiscally responsible. Low rates also prop up zombie companies, which are in effect inefficient companies that cannot stand up on their own, and hence are in the business of capital misallocation and capital destruction. One in six companies in Japan are zombie companies, and Japan's productivity ranks very low among OECD countries. This backs the idea that low rates are actually a drain on the country and its resources. Also, low rates are like a tax on savers, who then have to double down on savings, so spend even less. Furthermore, low rates limit the ability of a central bank to counter a downturn with emergency measures. Perpetually endless emergency rates is simply bad policy. As for Japan's solution? Japan is endlessly trying to get the tail to wag the dog. It needs to implement structural change, that is boosting its GDP and population growth. It could officially make English a second language, making it more international, and it could encourage immigration with a stronger currency via higher rates. It could also raise taxes on countless levels and start with higher taxes on alcohol and tobacco, which would have multifold benefits--providing a deterrent against products that reduce public health, and hence increase health care costs, and getting itself more revenue to pay down its debt.
@@robertmusil1107 its not like this has been tried before and every time the actually rich just left the Country ... and then the government squeezed out the middle class crippling the economy
OK, I'm Japanese. I understand the concept of the GDP-to-debt ratio. However, Japan holds the title of the world’s largest net external asset holder. Currently, we are facing cost-push inflation. People are struggling to secure money just to survive and eat. This is not inflation driven by increased demand. The root cause of why deflation persists and why we remain poor is simple: excessively high taxes. The combined burden of taxes and social security contributions is nearly 50%. No matter how hard we work, we cannot become wealthy. Recently, public frustration is growing towards the Ministry of Finance. They keep raising taxes, which is destroying the economy. People are demanding tax reductions just to survive. There is no hope for wage growth. The disappointment among people has turned into anger and hatred toward government institutions. If this continues, we may witness a collapse or something similar in the near future.
I think Japan is fortunate that it had a mini-babyboom in the 70s, so there's at least a decent number of 50-somethings who will probably work for at least a decade or two more. But when that chunk of the population retires there's going to be more people who aren't working and paying taxes than people who are. That's gonna get ugly. A lot of young people seem to understand this in some way. I'm a gaijin who teaches university students. The apathy is has grown and grown. It isn't a coincidence that Japan's English-proficiency fell so drastically this year. Part of that has to do with the fact that schools are still using the same stupid methods that most of Asia has gotten away from, but I think part of it is because so many students just don't care. They know they're going to have to bear the insane burden of paying for the medical care of the older generations. A lot of them have given up on achieving dreams and just want to be as comfortable as possible and enjoy pleasures before they have to head into the overtaxed grind of the workforce.
Also a huge number of big businesses in Japan are over burdened. The government's attempts to prevent large scale corporate closures basically locks up resources from being able to be reorganized. The business cycle is a natural part of capitalism. Allowing it to go on resets the economy. But ofc the people with money lobby the government to fight the business cycle (you have to expect people to be self interested) which ultimately progresses the dialectic towards reform into a new system, either from the system suffering critical failure suddenly and quickly reforming or a slow breakdown in complexity until it fizzles out.
@@Kagemusha08 Thank you for your comment. As you know, we aren't very fluent in English and don't understand it well. To be honest, I used GPT to help me translate this message into English. Many students probably don't think much about their future or what they want to become. However, after turning 20, they begin to realize the weight of real life, the challenges of hard work, and the reality of low wages. Some young people even start taking illegal jobs (what we call "Yami Baito" or "dark part-time jobs"). This might be the beginning of societal collapse. We’ve already seen the rise of what’s called "nesoberi-zoku" (people who only eat and sleep) in China. These are young people with no job, no hope, and no purpose-just sleeping their days away. I don’t want to see Japanese youth heading in the same direction. At the same time, excess mortality is on the rise. No one can resist the inevitability of life's end. Medicine stocks are also decreasing, leaving hospitals without enough supplies. It seems like we might soon face a situation where many in the older generation pass away. I don’t want to end up like the current elderly generation. They are often referred to as "rougai," which roughly means "troublesome elders." It’s like they’ve taken everything from the younger generation. Anyway, the current systems are unsustainable. We might witness a societal collapse before meaningful changes are made. P.S. My English teacher is Quentin Tarantino's movies. :)
@@averagedemocrat9546YES! History does not repeat itself, but it rhymes. We are facing the end of one cycle and the beginning of a new one. I want to keep your words in my memory, as your thoughts are very important to me.
I actually really hope japans economy picks up again, just a reminder, economists though the little nation would have a higher GDP then the US by this day
Economists will see a trend on a graph and assume it will continue linearly forever. This never happens but they blather on and on about how a nation with a real estate bubble is about to take over the world.
What financial strain when you are already at 250% & issue the currency? Lastly it's just ridiculous to consider Bank of Japan as not gov't ... Them purchasing debts of the gov't in 2condary market means they can cancel their own(part of consolidate govt) debts. If NOT we are in a alternate universe where balance sheets work differently!
their population is going to decline by like 20% over the next 30 to 40 years. They aren't looking at a revival, they are looking at decline, then collapse.
The wage price spiral won't happen unless there's a supply side shortage. This amount of wage increase will only decrease inequality for now, and won't be a problem if they have a handle on supply
The reason inflation has been so low in Japan for so long is actually due to various efficiencies that favours a good quality of life at a low cost, and technological progress only favours that further. It’s actually a great feature. The government has just been too conservative to fund major industrialization, transit, energy and research projects, which would have raised inflation over the past decades. Now Japan is losing all its industries to China. They were too complacent.
It really helped trading with LeasieAiken analysis and info, even with the market in a downward trend. Definitely riding the market wave is a good perspective..
Depends on what you mean. A big part of the problem is that there is 1 city that has like 1/3 the population of the entire country. Every business wants to be in Tokyo, so everyone wants to live in Tokyo, so property prices around Tokyo are outrageous.
Wow, congratulations on your impressive :nvestment success! Your discipline and focus on delayed gratification is truly inspiring. I'm curious, what are some of the key factors that you consider when making :nvestment decisions? Do you have any tips for those of us who are just starting to dip our toes into the world of :nvesting? Thanks for sharing your story!
I know price controls is a brain dead terrible recourse against inflation but you know what if, perhaps worth a shot, price controls to fight deflation? Hey you raise your prices right now!
After they got burned with mortgages in the past a lot of Japanese people are set on saving money. I personally doubt it will trigger an inflation wage spiral
@@baronbrummbar8691 You mean when US forced Yen to appreciate then restrained the car import to US and West , the pushed Japan to buy stuff from US. Thus sinking Japanese economy for decades to come ? then yes.
@@infinitybrain7336 the US can´t do any of that .... they can only do tarrifs which is the eact same thing they did to the EU Japan had a massive buble that was caused by its monetary policy and a litle action of the US and that buble bursted ....... that is on japan for shity policy a boom will always turn to bust if it is build on a lie
My question is why the dollar to other currency is not adjusted when the amount of dollar printed on 2020 was in trillion making the dollar double in amount that was existed before. Didn't this massive surge of dollar forced other economy to print as well as dollar was actually losing it's value by sheer amount (supply)of newly existing dollar.
price wage spiral is an upwards spiral ......... but it makes things worse as the money simply becoumes worth less ...... sounds weird but yes they want to increase inflation
Right now it’s between 2-3% and has been at the level or even higher since 2022. Additionally, loads more of foreign investment has actually been coming in, rather than out of Japan unlike the past few decades.
Sooooo... from this video I took away that Japan's history of deflation or 0% inflation is bad and the more current state of 2-5% inflation is also bad and may get worse, so what is considered good exactly?
Low, nonzero, positive inflation is generally seen as the best option. Encourages spending and investment while not provoking instability. It isn't perfect, though; people who do not own homes or have significant assets do get poorer in real terms, albeit slowly.
1-2% inflation is the ideal. Deflation is incredibly bad because it means a dollar today is more valuable then a dollar tomorrow. If that's the case why spend the dollar? Why make risky investments? It essentially makes the two most economically stimulating activities (consuming goods and investing capital) less desirable which in the long term leads to a slow errosion of the economy.
@@favourayo Your confusing inflation and deflation. 1 yen today is worth more then it was 10 years ago because japan has been in a deflationary environment since the 90s.
and their GDP has been stagnant for decades. They have been passed in GDP per capita by lots of countries. And with their population shrinking, and with that shrinkage accelerating, in the near ish future their GDP will start to contract.
when ur only idea to grow the economy and gdp growth is to raise inflation and artifically raise wages to raise inflation further..... Japan has tried all these back in the 90s and 2000s, all they did was build a debt bubble to debt to 200% gdp ratio and they are doing it again? what u should be doing is devaluing ur currency to make ur labour as cheap as possible, hopefully as cheap as China. america's
I never fully got the wage price spiral, price of many consumer products doesn't 100% exist of the price of wages. So if wages double (extreme example), that doesn't mean that prices will double (maybe 1,5x at most), thus making most people much better off and able to buy more stuff. Though for export this ofcourse might not be good, but I wouldn't count that under wage price spiral. That's whole other phenomenon.
Add companies increasing their margins to your equation. They make more so now you need a higher raise to just have the same amount that your money bought last time. It causes prices to rise until inflation forces an economic crisis
I love Japan, but constantly seeing 70+ year olds constantly doing hard manual Labor ist heartbreaking. And directly caused by the unwillingness to allow migration
They're not doing that badly yet. One day they will have to, particularly when it comes to the birth rate crisis, but it's an option of last resort because they want to try to save Japan as it is, not turn it into something else by inviting mass migration.
The solution would be simply to support families and help young people dating. But I guess they still want to live like an ant colony instead of humans.
How can you possibly discuss the Japanese economy without discussing population growth? Or in Japan’s case, population declines? Per capita GDP is actually quite robust. But you wouldn’t know that because you ignore all the of the relevant variables in this video. What kind of economist signed off on this video?!
@@lawjef It's less than ten minutes long. There's inevitably going to be a lot of condensing when discussing something as complex as a national economy in a timeframe that short.
@@Talisguy Enough time for sponsorships and begging to subscribe, you don't think they could have put an extra 60 seconds to briefly cover demographics?
@@Patrick-y4d1zIt's an independent news channel. They need ad money to keep making videos and they need subscribers for this to be financially viable.
I think it’s already too late; no matter how much is invested, it won’t recover. The same is happening in Germany with several century-old companies going bankrupt and a lack of innovative companies.
Especially when the worst effects of Japan's demographic crisis is gonna hit pretty soon; even if this works and the Japanese economy starts to function like a normal economy again, a lot of it is going to be counteracted by a shrinking labour pool and rapidly aging population. Beyond this, there's still a ton of issues to work out economically and I don't see how Japan could get out of its demographic decline better than before it started, or see anything anywhere close to its growth in the 1980's. Its incredibly hard to unfuck more than 30 years of economic stagnation.
@@bb-6359 The Japanese economy is huge, they just need to work on social policies to help young people have children. But that's the same as basically every developed country.
@@lawjef Their GDP per capita is like 3/4 was it was in the 90s. And since their population started shrinking like 15 years ago, that per capita number is being increased by their population shrinking which makes the per capita number sound better than it really is. Meanwhile the GDP per capita of countries like the US or canada now massively surpass japan. The US' GDP per capita is more than double Japan's. Not that far from triple. What part of that is "quite well"?
Japan cannot be revived for at least the next 50 years. All economic logic is explained by population structure and productive population. Even if you can decline or maintain the status quo, it is absolutely impossible to move forward.
The problem with 0% growth is that it's kinda like watching a corpse that doesn't decompose; it pretty much just stays there forever and ever and might even end up doing more harm than good. Still don't quite get why 0% inflation is bad though; something about some complex meta-economical math resulting in some inflation being better than no inflation or some other nonsense.
CORRECTION: In the original video, we twice confused GDP for the national budget. We have edited the video to fix this - if it's still wrong when you're watching it, it'll be because the new version is being uploaded, and so hopefully fixed soon. Also, at 3:38, the graph says 2021 when it should be 2024. Apologies for these errors, and we hope you nonetheless enjoyed the vid!
thanks for cool journalism
Deflation is Good thing, economy should serve people, not exploit people. Inflation is exploitation of people it steals people purchasing power and it goal is generate government a revenue by forcing people to consume. Deflation is much better. If person has saved up money, money value increases and person can wait to spend it when he gets best value about of it. Inföation focuses consumerist attitude, Deflation only reason to consume is if person really needs something then they buy. In deflation economy small businesses can survive, but corporations struggle. in Inflation, small business struggle but corporations strive.
@@asjaosaline5987it’s always a treat to see people write nonsensical economics advice in the comments
@@asjaosaline5987you don’t understand basic economics….. it becomes a death spiral of deflation. Not good for anyone
@@Aubrey2004-j4k Actually i undrestand quite bit. The problem is people are so stuck with kaynesian economics that they have forgotten that the economics landscape was a lot more diverse a few hundred years ago. Few thousands years ago even more so. Deflationary economy is only threat to governments and those who depend on governments. Normal ambitious people will be quite happy. There is always some comment. But "who will build roads". This means people are not educated economically but only indoctrinated on Kaynesian economics. You are not first to accuse that I don't know how economy works, I actually understand about 20 different economic concepts and how they work.
Have they tried turning it off and on again?
I think they did after WW2 ended
@Voodoo_Clerk If so, it workerd flawlessly
They did between 2019-2021
Sounds like that’s exactly what they’re gonna do 😂
it has been 'off' since the mid 90s
You repeatedly mistook GDP for the national budget - Japan's GDP is at around $4.2 trillion, meaning that the $250bn represents more like 6% of GDP.
Yeah, this channel has zero credibility. They dont understand math, they never mention population declines when discussing Japan’s challenges, and they constantly shill for education apps. Zero credibility
Japan printed 1 trillion out of thin air but nothing happens no imf/world bank but others are forced in to bankruptcy and sell their assets shows you this a corrupt financial system that only benefit few countries
so japan spends about 25% of gdp every year? that seems like a lot
@AaryaDutta-sv2wk That's actually quite low by the standards of the developed world. UK budget-to-GDP is nearer 40%.
@josephharrison8354 shows something doesn't add up the financial system is corrupt others are forced in to bankruptcy and sell all their assets
Just check again, $250bn is not a quarter of Japans gdp
probably they meant it is quarter of the government revenue.
@@denizaydemir6756maybe, but the point is that this channel struggles with basic facts. Where did they mention that japan’s population has been declining for decades? Nowhere. They are clueless.
Birth rate has been declining not pop@@lawjef
@@princemc35the population has declined slightly as well
@@lawjef Population has only been declining since 2008. I'm pretty sure most people know that Japan's population is at least stagnant if not declining.
Interesting times we're living in, when both Japan and Argentina are trying to get out of their special status as freak economies😅
And both are failing
@@ethandouro4334 Nope Argentina is becoming better slowly thanks to Milei
@@ethandouro4334Milei is trying to fix Argentina, but its hard without full support in the parlament.
@jacobmalecki He has full support to pass whatsoever he wants if he does public votes, and he succeeded in all of these bills, and it made Argentinians be in 52% poverty line.
@@kenpe1455 no, it isn't. I've went there, it's getting worse and worse
You cant print your way out of there not being any competition for labour. If the culture shames a worker for leaving their company for a better wage, the natural allocation of human capital and expertise is left unaccomplished or unrewarded. You cant have a thriving economy if people with higher skills arent funneled into the places where they can be the most productive (and demand the highest wage).
True but if unions are finaly able to negotiate collectively wage increases...maybe it'll work?
@WolfTheTrueKing it's better than no wage growth, but worse than a system that encourages workers to leave less innovative companies.
@@WolfTheTrueKing How? The average worker is not represented by a union
@@bicin4k Because Unions can negotiate better working conditions. We all KNOW how bad Japan's workaholic culture is, to a point where it's seriously a detriment to Japanese productivity.
Like yeah, you're right, the average Japanese worker ISN'T part of a labour union, but this is a hypothetical scenario where unions actually HAVE that sort of power/influence. It doesn't need to confine to reality perfectly, it just has to be realistic enough to be a valid scenario. Which it is. It's unlikely, but it's realistic.
@@bicin4k Well Japan's tremendous growth in the cold war was fuelled by high internal consumption which was made possible by powerful trade unions keeping wages high. It could be a step in the right direction.
slight correction: abe was succeeded by yoshihide suga in 2020, and then suga resigned in september 2021 when kishida replaced him
Hey, stop it...this channel is known for it's fact checking....*spits out juice in laughter*...nah, you're right. This channel is routinely behind in basic fact checking.
I like her, because, unlike everyone else, she always tries to pronounce every name correctly no matter what the language is.
simp
And she's gorgeous.
@@AetherUtopia and there’s that.
@AetherUtopia I like the British guy's voice better though.
@@titanicbigshipthe one with eh glasses or the other one?
Its weird that Argentina and Japan are so desperately to get out of their respective category that they may end up switching places.
good point
Back then Japanese people blamed everything on 'lazy millennials'. Now it's gen z gertting blamed. It won't happen to gen alpha though. Can't be blamed if nobody is around no more.
"work harder" "THEIR just lazy" Mega-corps talking points doesn't work when talking about Japan workaholic culture. Shifting the blame for who's really at fault the 👉COMPANIES👈 into anybody/anything else and people keep falling for this PSYOP
''lazy immigrates''
If millennials are anyone above like 25 i'd assume it'd be early to blame so called "Gen Z" for much
real wages falling in a deflationary environment is diabolical 💀
$250bn is a quarter of Japan's GDP? Google says it's just over $4trillion.
a quarter of a quarter😅
I think
They meant govt budget which is generally quarter of gdp.
maybe a quarter of its budget.
They very likely mean the government budget - Japan's government budget has been hovering around $1 trillion lately.
This channel is a joke. They cannot even get rudimentary facts correct. Repeatedly.
Best of luck to Japan 🇯🇵.
❤
They will need it with an aggressive China on one side, an equally aggressive Russia on the other side, and on their six, The Donald.
Hey hey what about Argentina?
@@fabamatic love Argentina but lives in crises 🙆♂️ oil exporter and always in crises
Permanent resident here. Until about two years ago the stagnant economy was fine. Not great, but prices and wages had stayed the same for 20 years, so not terrible, either. Inflation may be something like 2% on the books, but it feels like a hell of a lot more, and I suspect some aspect of inflation or plummeting, sorry, I meant PLUMMETING yen is not being captured. Mood has gone from a sullen sort of disenchantment with the government to deepening anger. Unfortunately, the right will capitalize on it.
Listening to billionaires complaining about "wage spirals" makes me want to play the smallest violin in the world
**Stares in Japanese labour laws and work culture**
How can you stare at what doesn't exist?
So I don’t know why western videos hardly mention the 1985 plaza accords, where America strong armed Japan into increasing the value of its yen because US industries like auto were being beaten. Exports suffered greatly, Japan responded with loose monetary policy to make up for it, and it led to a run away asset bubble that Japan still hasn’t recovered from. It’s like y’all want to gloss over that, and say Japan just magically fell off of its trajectory.
Sigh...when will economists realize that natural deflation isn't detrimental to the economy just like natural inflation. Keep going Japan. Let the world watch how small groups of people can keep dialing the economic knobs to fine tune an economy into the future better than the free market itself.
But I love how the inflation curve is starting to go down in Argentina
You are missing the reason why the 1.3 million cap on part time workers affects working mothers most, putting the cap at 1.8 million is actually encouraging mothers to work more and allow companies to pay more. The current issue is that mothers want to stay under 1.3 million to avoid being forced to pay social insurance individually instead of being covered by the husband’s social insurance. This should actually allow for more net income for these households. It should make a difference in household spending.
they didnt mention a cap, they only said that the tax free threshold is increasing.
@@jonathanodude6660that is the cap they’re talking about - the minimum threshold at which you pay taxes mentioned in the video is the same as a cap on the income you can have without paying taxes. It’s just rephrased.
@wilsongoulty interesting, thanks
Not to mention the economic damage Godzilla causes every time he resurfaces…
Printing money doesn't work, it delays and increases pain.
Also Abenomics proves it isn't just 'money printer go brrrrrrr' that is the sole cause of high inflation. Abenomics was 'money printer go brrrrrrrr' long before you heard of it.
Well, after Abenomics, Japan now has to cut the inflation. So "money printer go brrrr" is indeed the biggest couse of inflation.
@@ShadowNinja69 what? No? Abenomics was around for 10 years, inflation is around for 1-2 years in Japan.
And in the period of 2012 to Abe's resignation, money supply grew a lot more than inflation. No connections.
@@aliemreazgn3634 The video states that they are now trying to reduce inflation that was sitting at 4% after Abenomics. Even if the money supply grew more than inflation, inflation still grew by a lot (from deflation to inflation that is considered unhealthy) - becouse of the money printer. Also, economic results always arrive later than policy - so if inflation spiked after Abenomics stopped, it was still coused by Abenomics.
@ShadowNinja69 nope, today's inflation is way after QE and mostly caused by global inflation surge, rising energy prices and disturbed supply lines after Corona virus. Still, no relation whatsoever.
The speed and the effectiveness of this channel is getting better every month. Great work, team!
The problem with the Japanese government is it has an addiction to debt. A debt level in excess of 250% debt to GDP is massive. The result is that debt spending has a reduced impact on GDP. Such a massive level of debt also reduced its capacity to counter a downturn. Second, the BOJ has had rates at an emergency crisis level of below 2% for multiple decades. Such low interest rates may seem to be beneficial, but they exact a number of costs. First, they allow governments to overspend, which is obviously the case in Japan with the massive level of government debt. Raising rates forces governments to be more fiscally responsible. Low rates also prop up zombie companies, which are in effect inefficient companies that cannot stand up on their own, and hence are in the business of capital misallocation and capital destruction. One in six companies in Japan are zombie companies, and Japan's productivity ranks very low among OECD countries. This backs the idea that low rates are actually a drain on the country and its resources. Also, low rates are like a tax on savers, who then have to double down on savings, so spend even less. Furthermore, low rates limit the ability of a central bank to counter a downturn with emergency measures. Perpetually endless emergency rates is simply bad policy. As for Japan's solution? Japan is endlessly trying to get the tail to wag the dog. It needs to implement structural change, that is boosting its GDP and population growth. It could officially make English a second language, making it more international, and it could encourage immigration with a stronger currency via higher rates. It could also raise taxes on countless levels and start with higher taxes on alcohol and tobacco, which would have multifold benefits--providing a deterrent against products that reduce public health, and hence increase health care costs, and getting itself more revenue to pay down its debt.
When the economy mathematics is so f,Ed up that inflation is normal but deflation, stability is not
I believe they need to invest and take care more of their youth to improve their economy.
invest ?
invest with what
the nation is already in crippling debt
@@baronbrummbar8691 Take money from the old and wealth from the old and give it to the young. Quite simple.
@@robertmusil1107 its not like this has been tried before and every time the actually rich just left the Country
...
and then the government squeezed out the middle class crippling the economy
Please how ?
Am a born Christian and sometimes I feel so down 😭 of myself because of low finance but I still believe God😞
It's Wendy Lisa kidd doing she's changed my life. A BROKER- like her is what you need.
$356K monthly is something you should feel differently about....
Lovely! I enjoyed it like I enjoy a $100k monthly around the turn!!!
OK, I'm Japanese.
I understand the concept of the GDP-to-debt ratio. However, Japan holds the title of the world’s largest net external asset holder.
Currently, we are facing cost-push inflation. People are struggling to secure money just to survive and eat. This is not inflation driven by increased demand.
The root cause of why deflation persists and why we remain poor is simple: excessively high taxes. The combined burden of taxes and social security contributions is nearly 50%. No matter how hard we work, we cannot become wealthy.
Recently, public frustration is growing towards the Ministry of Finance. They keep raising taxes, which is destroying the economy. People are demanding tax reductions just to survive.
There is no hope for wage growth. The disappointment among people has turned into anger and hatred toward government institutions.
If this continues, we may witness a collapse or something similar in the near future.
I think Japan is fortunate that it had a mini-babyboom in the 70s, so there's at least a decent number of 50-somethings who will probably work for at least a decade or two more. But when that chunk of the population retires there's going to be more people who aren't working and paying taxes than people who are. That's gonna get ugly.
A lot of young people seem to understand this in some way. I'm a gaijin who teaches university students. The apathy is has grown and grown. It isn't a coincidence that Japan's English-proficiency fell so drastically this year. Part of that has to do with the fact that schools are still using the same stupid methods that most of Asia has gotten away from, but I think part of it is because so many students just don't care. They know they're going to have to bear the insane burden of paying for the medical care of the older generations. A lot of them have given up on achieving dreams and just want to be as comfortable as possible and enjoy pleasures before they have to head into the overtaxed grind of the workforce.
Also a huge number of big businesses in Japan are over burdened.
The government's attempts to prevent large scale corporate closures basically locks up resources from being able to be reorganized.
The business cycle is a natural part of capitalism. Allowing it to go on resets the economy. But ofc the people with money lobby the government to fight the business cycle (you have to expect people to be self interested) which ultimately progresses the dialectic towards reform into a new system, either from the system suffering critical failure suddenly and quickly reforming or a slow breakdown in complexity until it fizzles out.
@@Kagemusha08
Thank you for your comment.
As you know, we aren't very fluent in English and don't understand it well.
To be honest, I used GPT to help me translate this message into English.
Many students probably don't think much about their future or what they want to become.
However, after turning 20, they begin to realize the weight of real life, the challenges of hard work, and the reality of low wages.
Some young people even start taking illegal jobs (what we call "Yami Baito" or "dark part-time jobs").
This might be the beginning of societal collapse.
We’ve already seen the rise of what’s called "nesoberi-zoku" (people who only eat and sleep) in China.
These are young people with no job, no hope, and no purpose-just sleeping their days away.
I don’t want to see Japanese youth heading in the same direction.
At the same time, excess mortality is on the rise.
No one can resist the inevitability of life's end.
Medicine stocks are also decreasing, leaving hospitals without enough supplies.
It seems like we might soon face a situation where many in the older generation pass away.
I don’t want to end up like the current elderly generation.
They are often referred to as "rougai," which roughly means "troublesome elders."
It’s like they’ve taken everything from the younger generation.
Anyway, the current systems are unsustainable.
We might witness a societal collapse before meaningful changes are made.
P.S. My English teacher is Quentin Tarantino's movies. :)
@@averagedemocrat9546YES! History does not repeat itself, but it rhymes.
We are facing the end of one cycle and the beginning of a new one.
I want to keep your words in my memory, as your thoughts are very important to me.
This comment was better than the video, thanks.
"Plan to get the economy going" = We need to find a way to exploit the working class more!
Have they tried putting the economy in rice?
They had it in the sengoku era. Literally rice is the reserve.
I think the root problem in the economy is still there.
Yup, like usual the politicians and economists are just trying to treat the symptoms instead of fixing the actual problem.
I actually really hope japans economy picks up again, just a reminder, economists though the little nation would have a higher GDP then the US by this day
Economists will see a trend on a graph and assume it will continue linearly forever. This never happens but they blather on and on about how a nation with a real estate bubble is about to take over the world.
The last time Japan tried to restart their economy, they tried to do it by spending on their military and it started a war.
Aannnd then after they lost they got rich for a while
This has been a very informative video about Japan's economy, despite the errors.
what Japan need to change is work culture, not taxes.
Printing money to save the economy worked so well over last 35 years. What makes them think it will work this time?
They had very different problems than other countries. So it isn't really a good comparison.
What financial strain when you are already at 250% & issue the currency? Lastly it's just ridiculous to consider Bank of Japan as not gov't ... Them purchasing debts of the gov't in 2condary market means they can cancel their own(part of consolidate govt) debts. If NOT we are in a alternate universe where balance sheets work differently!
I do think culture, and the overworking culture plays a massive role in this.
deflation is such a fake problem,, like just print more money for economic stimulus?
Hopefully, this will also help Japan's low birth rate.
Japan: We need more inflation to tackle deflation!
Rest of the world: You got deflation!?
the problem with stimulus is you can't be short, so overcompensating is really the only option.
Why Is The Subtitle off ? It really helps me some time .
It is on mate
Japan will revive its economy accordingly.
their population is going to decline by like 20% over the next 30 to 40 years. They aren't looking at a revival, they are looking at decline, then collapse.
The wage price spiral won't happen unless there's a supply side shortage.
This amount of wage increase will only decrease inequality for now, and won't be a problem if they have a handle on supply
Ahh japan. An economy miracle based on undervalued Yen, selling goods to the US market.
The reason inflation has been so low in Japan for so long is actually due to various efficiencies that favours a good quality of life at a low cost, and technological progress only favours that further. It’s actually a great feature. The government has just been too conservative to fund major industrialization, transit, energy and research projects, which would have raised inflation over the past decades. Now Japan is losing all its industries to China. They were too complacent.
I don't get it.Japanese train system is the best.
@@renpetertoda I wonder how much money they paid
"re jiggling tax systems" when they use terms like that when discussing economics or finance, u know there are things they dont want to tell u.
5:30 clever use of graphic, I like it
Getting japanese wages growing ! Is Japan on track to finally beginning working on the real solutions to it's low birth rate?!
In my opinion
She's mostly on Telegrams, using the user name
LeasieAiken
The clarity and precision in Leasie market predictions are astounding. I'm so grateful to have found her reviews here on UA-cam as well.
Thanks for keeping it light and real at the same time. Much needed for us traders in times like these!
It really helped trading with LeasieAiken analysis and info, even with the market in a downward trend. Definitely riding the market wave is a good perspective..
Hi Rob, an interesting live could be projecting a prime Jakobe Walter's role on a championship team.
Housing crisis still hasn’t been solved in Japan, which right now contributes the most to affordability issues
Depends on what you mean. A big part of the problem is that there is 1 city that has like 1/3 the population of the entire country. Every business wants to be in Tokyo, so everyone wants to live in Tokyo, so property prices around Tokyo are outrageous.
@@ThatGuy-bz2in Tokyo prices still aren't that bad by global standards, pretty similar to the UK and much lower than London.
All these vicious cycles, chewing ankles with the crank set, getting oil everywhere, and the brakes binding, throwing people over the handlebars :P
We'll see. They haven't managed it so far, in 3 decades 🤷🏻♀️
I'll believe it, when I see it. But lets wish them luck
so hard, you can't not, not have inflation, but you can't also have deflation
thanks tldr
まぁでも1970年から人口減少が始まってだいぶたったが耐えてる方だと思う。
So, the first "baby decline" generation people are in their 50s now. And the low birth demographic crisis didn't turn Japan into Detroit, after all.
Good luck Japan ❤❤ hard working, educated and gentle people
Good idea, the solution to too much debt have always been more debt.
I appreciate that you suggested Sarah Jennine Davis in one of your videos. She was contacted, and working with her on investments has been fantastic.
Wow, congratulations on your impressive :nvestment success! Your discipline and focus on delayed gratification is truly inspiring. I'm curious, what are some of the key factors that you consider when making :nvestment decisions? Do you have any tips for those of us who are just starting to dip our toes into the world of :nvesting? Thanks for sharing your story!
I know price controls is a brain dead terrible recourse against inflation but you know what if, perhaps worth a shot, price controls to fight deflation? Hey you raise your prices right now!
That is just giving someone with TB cough medicine. Sure he might not be coughing anymore, but the TB is still killing him.
Thank you for you intelligent and beautiful explanation, have a great day, tha j you tldr
After they got burned with mortgages in the past a lot of Japanese people are set on saving money. I personally doubt it will trigger an inflation wage spiral
I believe the "four types of economies" quotes comes from simon kuznets
Use closed captions pls, it helps non english speakers to understand
Also the reason for japanese growth was halted were by action of USA.
the US just poped the buble that was ther
it would have poped regardless
@@baronbrummbar8691 You mean when US forced Yen to appreciate then restrained the car import to US and West , the pushed Japan to buy stuff from US. Thus sinking Japanese economy for decades to come ? then yes.
@@infinitybrain7336 the US can´t do any of that .... they can only do tarrifs which is the eact same thing they did to the EU
Japan had a massive buble that was caused by its monetary policy and a litle action of the US and that buble bursted
.......
that is on japan for shity policy
a boom will always turn to bust if it is build on a lie
My question is why the dollar to other currency is not adjusted when the amount of dollar printed on 2020 was in trillion making the dollar double in amount that was existed before. Didn't this massive surge of dollar forced other economy to print as well as dollar was actually losing it's value by sheer amount (supply)of newly existing dollar.
First Argentina and now Japan, hopefully both countries can improve their economies.
Argentina is improving thanks to the hard reforms it went through
Please read Human Action by Mises, and study Milton Friedman, Steve Hanke - I like your videos, but when I hear wage price spiral I have to close it
spiral usually means down, I don't think they want wages to spiral
price wage spiral is an upwards spiral
.........
but it makes things worse as the money simply becoumes worth less
......
sounds weird but yes they want to increase inflation
I’m surprised inflation is zero given how much tourist money there is
Right now it’s between 2-3% and has been at the level or even higher since 2022. Additionally, loads more of foreign investment has actually been coming in, rather than out of Japan unlike the past few decades.
Sooooo... from this video I took away that Japan's history of deflation or 0% inflation is bad and the more current state of 2-5% inflation is also bad and may get worse, so what is considered good exactly?
Low, nonzero, positive inflation is generally seen as the best option. Encourages spending and investment while not provoking instability. It isn't perfect, though; people who do not own homes or have significant assets do get poorer in real terms, albeit slowly.
1-2% inflation is the ideal.
Deflation is incredibly bad because it means a dollar today is more valuable then a dollar tomorrow. If that's the case why spend the dollar? Why make risky investments? It essentially makes the two most economically stimulating activities (consuming goods and investing capital) less desirable which in the long term leads to a slow errosion of the economy.
Deflation actually means a dollar today is more valuable than a dollar tomorrow. Was that a mistake?
@@favourayo Your confusing inflation and deflation. 1 yen today is worth more then it was 10 years ago because japan has been in a deflationary environment since the 90s.
@@ATMOSK1234 You're definitely the one who has inflation and deflation confused.
damn thats what the us needs deflation. But the rich will be damned if they let that happen
Increase interest rates, stop encouraging debt spending.
What? Increasing interest rates is how you drive down inflation. They are trying to drive up inflation. Your advice is to make their problem worse.
how about they move beyond fax machines and floppy disks? stuck in the early 2000s and don't know how to move forward.
I am pretty sure the biggest opposition party is Constitutional Democratic Party (CDP) not DPP
Yeah. I think she might've confused the CDP with the DPFP, which is another opposition party.
What was the name of Japan bank “consortium “ thing that was the cause of the crash?
Keynesianism again and again and gain, it will fail japan don’t gets it?
Japan goes full XRP
Japan has the 3rd highest GDP in the entire world only surpassed by the U.S and China.
and their GDP has been stagnant for decades. They have been passed in GDP per capita by lots of countries. And with their population shrinking, and with that shrinkage accelerating, in the near ish future their GDP will start to contract.
4th thanks to devaluation germany is no ranked 3th
Getting into big debt was never a good idea, was it?
when ur only idea to grow the economy and gdp growth is to raise inflation and artifically raise wages to raise inflation further.....
Japan has tried all these back in the 90s and 2000s, all they did was build a debt bubble to debt to 200% gdp ratio and they are doing it again?
what u should be doing is devaluing ur currency to make ur labour as cheap as possible, hopefully as cheap as China.
america's
New Japanese banknotes: ow, we r trying to restarting.
I never fully got the wage price spiral, price of many consumer products doesn't 100% exist of the price of wages. So if wages double (extreme example), that doesn't mean that prices will double (maybe 1,5x at most), thus making most people much better off and able to buy more stuff. Though for export this ofcourse might not be good, but I wouldn't count that under wage price spiral. That's whole other phenomenon.
Add companies increasing their margins to your equation. They make more so now you need a higher raise to just have the same amount that your money bought last time.
It causes prices to rise until inflation forces an economic crisis
There is a simple way to end deflation: print money. Money printer go brrr.
I find it shocking that after 3 decades, they still don't want to encourage foreign investments and immigration
I love Japan, but constantly seeing 70+ year olds constantly doing hard manual Labor ist heartbreaking. And directly caused by the unwillingness to allow migration
They're not doing that badly yet. One day they will have to, particularly when it comes to the birth rate crisis, but it's an option of last resort because they want to try to save Japan as it is, not turn it into something else by inviting mass migration.
8 minute video? It was less than 7, and of that 7, half of it was intro & 'recap'
1:21 it's really similar to China for 90s to 2016 lol
The solution would be simply to support families and help young people dating. But I guess they still want to live like an ant colony instead of humans.
japan is living in 2050
I thinking 😮😮😮
How can you possibly discuss the Japanese economy without discussing population growth? Or in Japan’s case, population declines? Per capita GDP is actually quite robust. But you wouldn’t know that because you ignore all the of the relevant variables in this video. What kind of economist signed off on this video?!
@@lawjef It's less than ten minutes long. There's inevitably going to be a lot of condensing when discussing something as complex as a national economy in a timeframe that short.
@@Talisguy
Enough time for sponsorships and begging to subscribe, you don't think they could have put an extra 60 seconds to briefly cover demographics?
@@Patrick-y4d1zIt's an independent news channel. They need ad money to keep making videos and they need subscribers for this to be financially viable.
一人あたりのGDPが少ないのは紛れもなく人口減少のせい
So Argentina needs to buy Japan?
I think it will be okay
Four types of economies: Advanced, developing, Japan and Argentina. Nice :)
They figured that they'd finally get ahead of all the people posting the Simon Kunsler quote in the comments followed by 😆😂🤣 at Argentina's expense.
I think it’s already too late; no matter how much is invested, it won’t recover. The same is happening in Germany with several century-old companies going bankrupt and a lack of innovative companies.
Especially when the worst effects of Japan's demographic crisis is gonna hit pretty soon; even if this works and the Japanese economy starts to function like a normal economy again, a lot of it is going to be counteracted by a shrinking labour pool and rapidly aging population. Beyond this, there's still a ton of issues to work out economically and I don't see how Japan could get out of its demographic decline better than before it started, or see anything anywhere close to its growth in the 1980's. Its incredibly hard to unfuck more than 30 years of economic stagnation.
Recover? Per capita GDP is doing quite well. But you would never know that from watching this channel…
@@bb-6359
The Japanese economy is huge, they just need to work on social policies to help young people have children.
But that's the same as basically every developed country.
@@lawjef Their GDP per capita is like 3/4 was it was in the 90s. And since their population started shrinking like 15 years ago, that per capita number is being increased by their population shrinking which makes the per capita number sound better than it really is. Meanwhile the GDP per capita of countries like the US or canada now massively surpass japan. The US' GDP per capita is more than double Japan's. Not that far from triple.
What part of that is "quite well"?
Japan cannot be revived for at least the next 50 years. All economic logic is explained by population structure and productive population. Even if you can decline or maintain the status quo, it is absolutely impossible to move forward.
Just what is wrong with 0% growth and 0% inflation?! Sounds perfect to me
The problem with 0% growth is that it's kinda like watching a corpse that doesn't decompose; it pretty much just stays there forever and ever and might even end up doing more harm than good.
Still don't quite get why 0% inflation is bad though; something about some complex meta-economical math resulting in some inflation being better than no inflation or some other nonsense.