There is a saying in Wu Gang's story of felling the laurel tree in the Moon Palace: "The laurel is as high as 500 feet, and it can be cut as soon as possible." No matter how hard Wu Gang tried, he could not finish the logging work in the end.
In the eight years since Shinzo Abe, who took the prime minister's seat in 2012, resigned again in 2020 due to a small stomachache (in fact, because he was helpless in the face of the new crown epidemic), the economic policy implemented has a very specific goal: the inflation rate to reach 2% to adjust the yen exchange rate from appreciation to depreciation. It is a pity that Abe has worked hard for 8 years. Regardless of inflation or the depreciation of the yen, it is as lackluster as Wu Gang cutting down a laurel tree.
But by June 2022, without any effort, all Japanese feel the devaluation of the yen and hyperinflation.
The just-published Ministry of Internal Affairs and Communications "Family Financial Survey" shows that in April 2022, the beef consumption of Japanese households decreased by 11% compared with the same period last year, to less than 1 catty (494 grams), and the expenditure was 1,654 yen (about 82 ounces). RMB), a decrease of 6% from the same period last year.
The Empire Data Center conducted a survey of commodity prices, and the latest figures given are that tens of thousands of products, especially food, have increased their prices in recent months. The Japanese government has not yet released the inflation index for 2022, and it is certain that it is estimated that it will exceed 2%. The policy objective on inflation was unexpectedly achieved nearly two years after Abe stepped down.
The yen exchange rate was 79 yen per US dollar in 2012 when Abe came to power. In September 2020, when he stepped down, it has fallen to 105 yen, but in June 2022, it has fallen to 135 yen again, basically Abe came to power. half time.
The efforts of Japanese politicians after Abe and Abe have made the exchange rate of the yen basically no longer an important part of policy goals. On the contrary, the excessively depreciated yen exchange rate has significantly reduced the quality of life of ordinary families, which is too much.
The decline of the yen exchange rate this time is related to the adjustment of bank interest rates in the United States, which attracts too much international hot money to flow to the United States. The simple countermeasure is to raise the interest rate of the country, but Japan has too much national debt (1,200 trillion yen, more than two years of GDP), and compared with the outflow of Japanese yen, the interest rate on the national debt that the Japanese government needs to pay is given to The economic pressure is even greater. Knowing that there are countermeasures, the Bank of Japan has been reluctant to use it.
The way to deal with inflation is actually very simple: raise the income level of the people and let wages run ahead of inflation. All countries use this method, and Japan did the same in the 1960s and 1970s. It was very successful and naturally rich in experience.
However, compared with other countries, Japan has not raised its national wage income for a long time. The Japanese government is reluctant to provide relevant figures to its citizens, but the Organization for Economic Co-operation and Development (OECD) recently released a table of changes in wages and prices by country. Among them, the nominal wage in South Korea in 2020 is 2.92 times that of 1995, and the price of goods has become 1.92 times. Under the same conditions, the United States is 2.23 times and 1.7 times, the United Kingdom is 2.08 times and 1.64 times, and Germany is 1.64 times and 1.41 times. In other words, the increase in wages in these countries is greater than the increase in prices.
The situation in Japan is extremely special. In 2020, wage income is 0.96 times that of 1995 (not rising but falling), and prices have become 1.04 times. This means that in the past 25 years, Japan has experienced a significant decline in the quality of life due to the decrease in income and the increase in prices, and only Japan has such a situation in the OECD.
The depreciation of the yen and inflation in economic policy, like cutting down a laurel tree in the moon palace, used to be an impossible goal, but when another condition was realized, people began to worry that the Japanese economy would go deeper and more difficult to find. Export.
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