In the past, Japanese economic circles agreed that the depreciation of the yen was beneficial to exports and the yen must be kept down. However, this statement applies to conditions. It must be established under the following three conditions.
1. Domestic labor costs are relatively cheap.
2. Raw materials are cheap
The factory is located in China.
But now, almost all Japanese large and medium-sized enterprises have gone out to set up factories and produced locally, unable to benefit from the depreciation of the yen.
The traditional advantages of Japanese enterprises have also been taken away by South Korea and Taiwan Province Province. Even if the yen depreciates, it is difficult for Japanese companies to regain their glory in the international market. The side effect of the depreciation of the yen is immediate, oppressing those enterprises that make money by importing cheap resources and products.
Because people have been stuck in the thinking that "the depreciation of the yen is equal to increasing exports, increasing exports is equal to economic improvement, and economic improvement is equal to the rise of the stock market and the increase of income", the sharp depreciation of the yen in the months after Abe took office has brought about a continuous rise in the stock market. However, one thing is different from the past, that is, exports have not rebounded.
It has been almost five months since the yen began to depreciate, but Japan has not eliminated its trade deficit, and the export containers of Kobe Port have not increased.
As long as the depreciation of the yen cannot drive exports as before, Japan's prosperity will not continue to improve and the stock market will begin to fall. There is only one real use of yen depreciation, that is, hollowing out the assets of ordinary people and compressing government debt. When people know that Abenomics was originally used against ordinary people, Abenomics will lose its luster, and the consequences are unpredictable.
But in any case, the yen will never go higher again. RMB is different.