Japanese Yen continues to crash, almost 155 Yen to USD 📈 \ stacker news ~econ

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Where does it end? Is there anything the Bank of Japan can do to rescue this situation that isn't just kicking the can further down the road? Will the 4th largest economy undergo hyperinflation?

YEN/USD was at 146 when I visited Japan just a month ago, I think that was after BoJ intervention. Great for tourists, but I feel so bad for this nation of amazing people and culture that has lost so much of their purchasing power.

My feeble understanding is that there is a "carry trade" going on where entities are borrowing from Japan due to its low interest rates and investing in USD returns with higher interest rates, but Japan can't raise its interest rates to stop this because of its massive debt...

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269 sats \ 10 replies \ @siggy47 16 Apr

I'm curious to know whether our Japanese stackers on the ground are noticing yet? Everything must be affected by higher oil prices. BOJ will have to start selling treasuries, so US yields will soar further, which in turn should crash US equity markets.

219 sats \ 3 replies \ @john_doe 16 Apr

Thanks to the currency problem I think I got a new Bitcoin friend at least in Japan. Do Japanese stackers notice? I would say yes, definitely (although I am not Japanese). The situation is exactly like in When Money Dies, however based on the book I would say it feels like in 1919, so it is not hyperinflation. It is inflation and shrinkflation (price increase plus smaller packaging). If people go everyday to McDonalds people may not notice anything in Japan, as prices didn't increase much. However if people on the ground know what food really is, then they most likely have noticed as I do that imports switched to food from Vietnam, GMO food without taste, added sugar in processed liquids, etc. Example: cacao I bought went from 2000 JPY to 3000 JPY. It increased. However for people buying chocolate typically what I would expect is the maker increases the amount of sugar, uses Ajinomoto-like substances a little bit more, and decreases the amount of cacao. End result my guess is the price of chocolate may have slightly increased (I didn't check specifically for chocolate though, sorry)

99 sats \ 2 replies \ @siggy47 16 Apr

Thanks for the insight. Do you drive? Have gas prices risen recently? I also would think transportation costs for consumer goods will start rising substantially.

99 sats \ 0 replies \ @john_doe 16 Apr

Let me add to the other answer that I see more a social shift than a price shift. Like in the past there was no Japanese prostitutes standing in the street of Ikebukuro for example, whereas now there is.

99 sats \ 0 replies \ @john_doe 16 Apr freebie

Sorry, I don't know for this year. In 2022, in Okinawa I know the price of oil was high, it also increased for mainland also. This year I am in the process of taking my license driver for motorcycles in Japan so didn't drive yet ;) For consumer goods, bear in mind shops like Unicolo or Daiso do a pretty good job at keeping prices low. Toyota cars are still cheap too, I saw one, second hand, for less than 50 0000 JPY this weekend. So price increases at least currently is not dramatic. In many cases price increase is hidden in lower quality.

200 sats \ 4 replies \ @chungkingexpress 16 Apr freebie

I live in Japan but am lucky to have a mix of local and overseas income.

Overall wages are low compared to my home in New Zealand or USA etc. Minimum wage of ~¥1100 per hour, $7USD, most white-collar jobs pay way less than West. However cost of living is also relatively cheap. You can have a decent lunch for ¥900 and a comfortable apartment in Tokyo can be in the range of 80,000 - 160,000yen per month. Insurance and healthcare are also very cheap.

There is a sense that most companies try to keep their prices as similar and stable as possible due to lots of competition but there is also maybe a cultural component. If a company was seen to raise prices explicitly then I think people and media would come down very hard on them. There are expectations of what things should cost and it is hard to step outside of that unless the whole industry raises their prices at the same time, which has happened over the last few years.

The only time I have heard Japanese people experience the weakness of the yen is when they have tried to go overseas for travel.

There is more to it as I think the pernicious effect of a weak yen is manifesting in other places, but honestly my lived experience here even if I was earning only yen locally is much better than New Zealand. Housing and food in particular is super cheap compared to what I get back home.

99 sats \ 3 replies \ @siggy47 17 Apr

Thanks for your input. I don't think it would be a case of price gouging if the falling yen causes price increases. It may not be controllable. Please keep us updated if you sense a change.

99 sats \ 2 replies \ @chungkingexpress 17 Apr freebie

Yes I must of edited my comment to be more precise after you replied, sorry. I don't believe the narrative of greedy businesses price gouging, but more likely the supermarkets would "take the hit" to maintain a stable price and either reduce the quality in the least damaging way possible or otherwise cut costs elsewhere while maintaining high standards.

E.g. in my experience if word got out that a place is "expensive" it would kill it and someone else would come in and work harder to undercut them.

One could probably write a book on the dynamics of "Japanese society", but there are expectations around price and quality and a very strong anchoring bias as the place has not had inflation for 30 years. That may change soon, you see stickers with new prices written in restaurants etc, but price increases are still emerging as a "thing".

199 sats \ 0 replies \ @flat24 17 Apr

I think that not having had inflation for the last 30 years will be quite hard for the average young Japanese, who does not understand how Fiat and the economy work. By living anchored to the JPY all the little savings power you have, you will see how the purchasing power in your hands is diluted... fact: for periods of high inflation "money is of no use and merchandise works better to save saving power." buy so to speak, although if you are reading this, you already know bitcoin and will not suffer from the inflation of Fiat money

33 sats \ 0 replies \ @siggy47 17 Apr

Thanks for this information.

236 sats \ 0 replies \ @riberet19 16 Apr

If I'm not mistaken, the Bank of Japan is one of the largest holders of US treasury bonds, if not the one that owns the most, right? If they start selling bonds en masse, maybe your deduction will be met.

209 sats \ 0 replies \ @FallingD02 16 Apr

I suppose there are already many Japanese Awake about this topic, for some reason the BTCJPY was one of the first along with the BTCRUB to set a new Historical High

209 sats \ 0 replies \ @Malachi17 16 Apr

Just guessing here, but having your PM assassinated has got to have some kind of negative impact on the entirety of your nation sooner or later: https://www.cnn.com/2022/07/08/asia/japan-shinzo-abe-dies-shooting-intl-hnk/index.html

210 sats \ 0 replies \ @Coinsreporter 16 Apr

Over the next 4 years, India’s GDP will likely touch $5 trillion, making it the 3rd largest economy by 2027, overtaking Japan and Germany, being the fastest growing large economy with the tailwinds of demographics (consistent labour supply), improving institutional strength and improvement in governance.

So, looking at this scenario, I can speculate that India can surpass Japan within the next 12 months or so. By the year 2027 top three economies will be USA, China and India respectively.

209 sats \ 0 replies \ @Undisciplined 16 Apr

It will be interesting. I doubt they see hyperinflation in the near future, but of course that's where this story ends.

199 sats \ 0 replies \ @riberet19 16 Apr

I think long-term hyperinflation is what's in store for Japan, the central bank of Japan decided to set up this whole debt circus, heads are going to roll.

209 sats \ 0 replies \ @TheWildHustle 16 Apr

Freaks have been saying that Japan would be one of the first big domino's to fall....

199 sats \ 0 replies \ @ch0k1 16 Apr

I have a feeling this is just the beginning

199 sats \ 1 reply \ @Taft 16 Apr

Can you tell me if this news is positive or negative for Bitcoin enthusiasts? I'm asking on behalf of a friend. 😉

99 sats \ 0 replies \ @riberet19 17 Apr

Always positive

199 sats \ 1 reply \ @nym 16 Apr

Are the prices of goods and services going up to match?

16 sats \ 0 replies \ @gmd OP 16 Apr

I presume so, but if you can figure out a way to live in Japan and make USD you can live like a king.

Crazy the amount and quality of food you can get for $6... I wanted to tip them 100% but it's just frowned upon in their culture unfortunately.

99 sats \ 0 replies \ @BitcoinIsTheFuture 17 Apr

This is the future? Nope Bitcoin please