Goodbye Japan, Hello Korea

Tyler Durden's picture

As the government and Bank of Japan constantly survey the marketplace for speculation while intervening en masse with ever-decreasing levels of effectiveness, we thought the following charts would highlight the impact of the relative strength of the JPY. Of course, in the past, at least the trade surplus (thanks to these legacy companies) used to provide incremental capital into the country but now even that is gone. As Credit Suisse notes, "the TWI of the JPY has appreciated by more than 40% post crisis – even more than the CHF! But it is the relative strength versus the KRW that is really hurting Japanese firms. The Won plummeted sharply post crisis and has recovered nowhere near pre-crisis levels. Some of this shift in relative competitiveness may be reflected in the market cap of Samsung versus that of major Japanese tech firms. Samsung is more than three times the size of Japan’s top technology firms."

Since the crisis, Samsung has overwhelmed the largest 5 Japanese Tech firms...

 

 

It was not always this way...

 

 

And in context - here is AAPL...

 

Why is this a concern? Because whereas in the past Japan's economy at least had a source of endogenous capital courtesy of its trade surplus to offset all the other drains of domestic capital, this is no longer the case as we showed recently.

This means that the government is now effectively the only source of capital to offset all other Current Account outflows. This also means that Japan will be forced to monetize more and more, issue more and more debt, even as its population gets older and older and is forced to withdraw ever more savings, shrink the financial system, and sell ever more securities, thus finally accelerating the collapse of the Japanese monetary neutron star's 30+ year implosion into what, inevitably, becomes a black hole.

 

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BlueCollaredOne's picture

I will never understand asians...

akak's picture

You mean Orientals, right?

francis_sawyer's picture

I thought I was the token resident racist/anti-semite on ZH... Actually ~ I'm just filling in until Trav returns...

akak's picture

What is possibly racist about the word "Oriental"?  To idiotically use "Asian" as a substitute is to totally ignore the many Asian nationalities which are NOT Oriental, such as Russians, Arabs and Indians, not to mention just once again highlighting the gross geographical ignorance of most Americans.

I can only laugh whenever I hear some ignorant fool use the word "Asian" to mean "Oriental" --- which most Orientals I know laugh at as well.

Spastica Rex's picture

All animals aren't orangutans.

Therefore, never call an orangutan an animal.

QED

francis_sawyer's picture

the /sarc should have been implied...

francis_sawyer's picture

the /sarc should have been implied...

akak's picture

 

All animals aren't orangutans.

Therefore, never call an orangutan an animal.

Actually, Spastica, the moral here is to never call an orangutan an animal while implying that orangutans are the ONLY animal.

juliawong's picture

I prefer to be called "North East Asian", which distinguish ourselves from "South Asians" = Indians and "South East Asians" = Indoneisan, Fillipinos (which Hong Kongers hire as maids and domestic servants).

HD's picture

Oxycontin is a hell of a drug...

slaughterer's picture

When Americans look at the dismal and frightening development of the Japanese economy, they need to realize that they are staring at their own future.

 

patb's picture

We bankrupt our zombie institutions,  except for Chrysler, Citibank, Goldman, BAC, JPM, MS,,,,

 

Forget I said anything

molecool's picture

I visited Korea three times in the past two years and the signs of expansion and progress are everywhere. What's more important however is that the Koreans are long term planners. They know where they want to be five, ten, twenty, fifty years from now. Everyone is working their asses off over there - I have rarely seen harder working people in my life.

Plus Korea is fun! You haven't partied until you spend a few nights with some Korean hosts - enough said ;-) Seoul is off the hook and I also traveled to the country side. Some of their mountain ranges are very reminiscent of Yosemite, believe it or not - great rock formations. The cities are super clean - I didn't see any trash on the roads or in the cities.

Downside: Very hot summers and brutally cold winters. The wind in Seoul literally blew through me - not for the faint hearted.

Troll Magnet's picture

Countries like Korea and Japan are great because they're very homogeneous.  People share common values, beliefs, code of ethics, honor, etc.  Therefore, very low crimes and general sense of harmony.  But we're told that multiculturalism is what's up.  The decline of western civilization, bitchez!  

Spitzer's picture

Good thing the US military interviened in South Korea then eh ?

Or do we all just want to forget all the wars the US won ?

 

Spitzer's picture

Not that cold of winters man.

 

HD's picture

I didn't care for Korea - I couldn't find reruns of M*A*S*H on any channel...

TumblingDice's picture

Korea has definitely got their shit together. Going back to the states after living there for a couple of years is like going back in time. In America people are generally less polite, the technology is behind (can't use phone or wireless in subways, theatres are low quality, internet is slower, etc etc) the cuisine is not as healthy and the country is generally dirtier. 

juliawong's picture

Amen. You can also substitute Korea with HK and US with UK and have the same effect.

WeeWilly's picture

Been there 4 times in 5 years (visiting family, my wife is Korean). A have described it the same way, back to the 60's. TV is full of variety type shows. Once every show, a man dresses like a woman and they laugh their asses off. It is a dirty place, though. Lots of pollution comes over from coal plants in China and few environmental limitations. The longevity there is close to what it is here despite the healthier diet. Lots of smokers, stressful living in crowded conditions (Seoul area) and poor air quality. People love family and are very hard working.

patb's picture

They said that about Japan from 1965 to 1990.  Japan hosted the Olympics in 1964 and 1968 (Summer, Winter).

 

Japan was building the finest Bullet train system in the world in the 1960s.  

 

Japan was building World Class technology in the 70's and 80s.

 

Same thing as Korea, soon enough.

draghithebearslayer's picture

yeah, sure, koreans got their shit together. so much so that Korea has the highest suicide rate in the world, along with the lowest birth rate in the world. look from outside looks like they're working wonders; when you look at it from inside, korea is one of the most fucked up hell hole on this planet that every one of its sane inhabitants want to get the fuck out from.

 

AldoHux_IV's picture

Crony capitalism in cycles thanks to currency manipulation and free trade agreements

falak pema's picture

Merkel encourages Germany to increase its exchange with Korea and wants EUrozone to open up the market to korean model; France wants the Koreans to export less and import more on a BILATERAL basis with each European nation.

Absurd logic, Korea is now producing for Europe in East Europe (Slovak, Czecho, Poland) and France has to adapt its competitivity. Korea is now the lead dragon in Eurozone.

buzzsaw99's picture

Samsung is the shiznit.

slaughterer's picture

Samsung will buy Japan in 2 or 3 three years, and make every Japanese citizen a debt slave to Samsung.  

molecool's picture

I guess payback is a bitch...

patb's picture

China and Korea will seek to make Japan their bitch.

 

Their aging, radioactive bitch.

centerline's picture

Decent tech products for the most part.  They really have done a great job all around.  Will be interesting to see how this play out, especially in the mobile device arena.

buzzsaw99's picture

The television picture can't be beat, neither can the computer monitors. If there is one deficiency they have it is the sound (the same problem they all have/had) but for that there are external speakers/amplifiers. There was a stretch there when I felt like a crAAPL junkie. I still don't have it out of my system entirely.

centerline's picture

I've got a handful of Samsung items and haven't been disappointed yet.  Especially at the price points.  One of them is an older DLP TV that has worked flawlessly since I bought it.  Just changed the light bulb for the first time this year.  In a world where these items seem to become more and more disposable, this says alot.  Either Samsung is building decent products or needs some serious improvement in planned obsolescence - lol.

buzzsaw99's picture

At least the capacitors don't pop within the first year like the cheapies do. There is a ton of room to innovate but I don't feel like they are moving very fast in that arena. The dvd players are wireless and have aps for netflix et al but still not functional for internet surfing and haven't really changed in three years. The audio jacks on the "smart" tvs are not remotely controlled, they aren't wifi capable either, but they are energy efficient. A tiny phone is 10X more advanced than a 73" television which I find sad. If they ever get everything working interchangeably they will sell a lot more product imo.

MachoMan's picture

For all of the price points and picture quality, I'll beg to differ and put panny plasmas at the top of the heap.  Samsung makes great products and definitely a +1 on computer monitors, but I'll put a panny plasma against a sammie plasma any day of the week and give you 2:1 on price point.

buzzsaw99's picture

Can't beat a plasma for watching sports etc.

Yen Cross's picture

 I like Samsung, pretty much everything...  Samsung stock is expensive to... Samsung Electronics Co Ltd (005930.KS) Quote| Reuters.com

 

 

 Ref; 1 US dollar = 1089.8400 South Korean won
AG BCN's picture

It still scores high on the cute chickometer. 

Spitzer's picture

South Korea does too. A study indicated that S Korean women are the tightest in the world.