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A Nation Of Beggars: Under Abe, Japanese Households With No Savings Rise To All Time High
Once upon a time, a few deluded individuals held hope that quantiative easing may actually do something to improve the plight of the common person instead of simply transferring wealth from the poor to the rich at an ever faster pace. Five years of failed monetary policy later, which has done nothing to stimulate the economy and everything to stimulate unprecedented non-risk taking that makes even the epic asset bubble of 2007 pale by comparison, this naive assumption has been thoroughly destroyed. However, for all those who don't splurge on yachts, mega mansions, and private jets, the pain is just starting. The latest evidence of this comes from Japan where according to a survey by the Bank of Japan released today, the share of Japanese households with no financial assets rose to a record as falling incomes forced people to dig into their savings.
According to Bloomberg, as a result of Abe's disastrous "reflation at all costs" policies, the proportion of Japanese households without financial assets reached 31 percent up from 26 percent a year earlier and the highest since the poll began in 1963.
But that's not all: it's about to get even worse: Abe needs to, and has been desperately trying to convince companies to drive up workers’ pay, so that he can sustain a "recovery" that has only manifested itself in stock market reflation, a crashing currency and soaring import prices. Already facing declines in wages - the 16th consecutive month of dropping wages in fact as we showed a week ago - households will be hit in April by a consumption-tax increase intended to shore up Japan’s finances. Only now a third of Japanese society will have no reserves which to tap. And that third is only going to increase as more and more are forced to sell that last asset they have: Japanese equities, until Abe's pathetic experiment meets its inevitable final outcome.
In other words, thank you Abenomics for being precisely the failure which we predicted a year ago it would be. In the meantime, the class disparity in Japan is merely tracking that of the US tick for tick, as the middle class in yet another country is destroyed, and forced to spend all of its accumulated savings on staples like food and energy, even as the "deflation monster" ravages all other goods and services and certainly wages, meaning the government is locked in doing even more of the same failed actions that have brought the country even further to the edge of total collapse, hoping for a different outcome this time.
Bloomberg continues:
“It’s critical that Abe succeed in convincing corporates to raise wages,” said Izumi Devalier, a Hong Kong-based economist at HSBC Holdings Plc. “Lower-income households may come to feel they’re getting the short end of the stick from Abenomics.”
Since a year in, verbal urging has failed, the last option is legislation, and a Japanese government which passes laws on a monthly, or weekly, basis decreeing how many percent higher the new minimum wage will be, until finally all the "export-driven" top line growth evaporates. As for capital spending and fixed investment, forget it.
In conclusion, like with every other insolvent, authoritarian government, there is some hope:
“The survey shows a grim wage situation,” said Akiyoshi Takumori, chief economist at Sumitomo Mitsui Asset Management Co. in Tokyo. “Now some companies are hinting at higher salaries so we may see a better result next year.”
Good luck, but please don't hold your breath. Instead, just keep holding your begging cap to capture some of that QE "wealth effect" trickle down.
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" the proportion of Japanese households without financial assets reached 31 percent up from 26 percent a year earlier"
A change of that magnitude for a measure that broad is astounding.
Japan is run like Detroit. The US under Obama is about the same or probably a lot worse.
Re: The US under Obama is about the same or probably a lot worse.
Been 60+ years of perpetually increasing debt. The Obama administration is just the latest group of people trying to "prove deficits don't matter".
well, the thing is, that is sort of correct. it entirely depends on whom you address when you say that it doesn't matter. to the 0.01%, it most certainly doesn't.
To add insult to septic wounds, had the Japanese invested in the Nikkei "stock market" over this time frame, which hit a high of 40,000 in 1990 and has declined by 70% in nominal terms (and 90%+ in real terms) since then, now resting just above 14,000...
...and had saved separately, aside from pouring money down the Nikkei...
...they'd be double-phukked-good!
Gotta' love that central bank fractional fiat reserve voodoo!
Go-Go Kuroda-san!
Virtually all Japanese are without savings given that they have either directly or indirectly invested in Japanese government bonds which are worthless when push comes to shove.
They're not out of failures yet...there's always wage and price controls < nuclear option >
Where is all that diaper money going to come from then?
I'd hate to see the elderly pinching one off in the gutter a la Chinese and their children...
You ever wonder why the stinky finger sushi roll is packed in tight with the same index finger used for wiping one's ass?
Well now you know.
Since the rolls at the local sushi restaurants were being named Fukishima Rolls and were being advertised can be used as glowsticks, I stopped eating sushi.
Hmmm...United Slaves of AmeriKa are not too far behind...
if you expect hyperinflation in the future. why would you save your money for that.
lol ching chong smart guise
Pffffftttt 31%!?! 'Murica has a much higher rate than that. Plus we gots EBT cards.... So we good. Gotta go, need to scout out my entrance strategy into Walmart on Black Friday.
Do you remember the longest life expectancy in Japan ( due to hidden corpses of elderly family mebers in backyard while still collecting the pensions?)
Stupid who gives. More stupid who dont take.
Yes, and it seems that the "high suicide rate" is really due to many murders that the cops don't want to have to solve, often because it is in their economic interest not to. Plus, it looks bad to have a high murder rate; better to save face and call it a suicide.
Women there don't report rape; it is considered too shameful.
No incentive to ave when you get .01 back every year. I really like the hint that they might increase wages - next year. LOL
re: they might increase wages - next year. LOL
Sign seen hanging in an Edinburgh pub: Free Beer Tomorrow.
If Abe wants to put money in the hands of Japanese workers, why doesn't he just have the BOJ send them checks?
I don'know. There is NO innovation in Japan. Once you provide innovation for them, they INDEED perfect it.
Their approach to become more innovative was to, create think tanks, hire US innovators and file a shitload of US patents. And I mean a shitload.
Problem is: technology moves too fast and leaped right over the majority of their patents. Now they are trying to remedy that.
SHUT DOWN THE FUCKING US PATENT OFFICE and bomb the shit out of all others!!!!! Seriously man, patents are killing innovation in this country.
And if youz guys wanna really make an impact, Guy Fawkes the shit out of the patent office(and servers). Japan will be toast. Burnt toast. They survive today because they gamed the US system.
Over.
Off topic, but be damn grateful you ain't on the island of Leyte in the Phillipines...
http://www.wunderground.com/blog/JeffMasters/comment.html?entrynum=2572
Needless to say, it will make landfall as a Cat 5....
Brown skin and not juice, WGAS!
Over.
Maybe Abe can apologize for his fuck up and it will be all better just like Zero just apologized for his fucked up insurance policy. Now that he has apologized we can forget about it , and life will be nothing but skittles and rainbows.
japan ... the avant garde ...
American writer criticizes Japanese for having no savings. Completely unaware of the irony? Or are you being stealth sarcastic?
27% of Americans have less than $1000 saved.
That's not really the right way to take it. The writer is criticizing a disfunctional government for making it impossible for hard working and thrifty people to save. It's not meant to slam Japanese citizens.
Numbers like this are common for American families; including myself had I not been schooled by an asian spouse. 31% for an East Asian country, is just remarkable. How sheeplike are the Japanese? How trusting in their masters? Anyone? I cannot fucking believe it.
This is going to be one difficult decade for a lot of people.
So much for the idea that all East Asians are big savers.
I don't think it shows that they aren't savers. It more likely shows that the wages and prices they are dealing with, are making saving impossible. The Japanese people I read most often about are unbelievably frugal, but are so badly paid and pay so much for everything that they still can't save.
Thankfully SUKI (tm), The New World Religion (tm) members contribute generously to their choice of major international religion, "motherfucking religion" every month. And thus can look forward to promotion to higher ranks as members of the clergy, and thus, the payment of a monthly tax-reduced or even tax-free religious stipend*. SUKI (tm), The New World Religion (tm) is available worldwide*, not just a Japanese religion anymore.
* except where prohibited by law.
Dear Japan: Welcome to the fucking club.
Welcome to the world of infinite fiat and diminishing returns.
The US lead you to throw your savings into in Hawaiian real estate. That money vaporized.
Now the US fed has guided Japan to path of massive printing.
Debased currency and radiation...the gifts that keep on giving...
without financial assets reached 31 percent
Without assets an individual in a population that uses any form of Keynesian mechanism or QE is basically crucified by the rate of growth of assets and devaluation of fiat money. Next time you look at a fast growing chart mirrored in so many things you want to invert it to show the rate of decline of the worth of people with no assets.
That is your foodstamp / benefit programme and ... dah-dah they can't afford that neither so it will be cut.
This is Obama's fault, right?
This is what happens when savers get no interest payments on their bonds - they go broke. Benjie and janet will do the same here - we are the next japan. The only way to survive is to buy FB and TWTR.
OK, I'll help them out. I have been wanting to go to Disneyland Tokyo for some time now. Been to both here on the mainland, and love them both. OK, I really love Walt Disney World more........
Anybody notice how well DIS did in the fourth quarter - yet their stock still dipped today? I wonder if folks were selling theirs in order to get some Twitter?
Disney Sea - the real shit!
Kyle Bass.