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Japan Base Wages Decline 23 Months In A Row
Proving once again that you can't print your way to general economic prosperity, Abenomics took another shot to the chest last night as Japan's base wages failed to rise month-over-month for the 24th month in a row (the longest streak in history). Even after all the promises and hope of the spring wage negotiations, Abe's 'plan' to guilt employers into raising wages is not working; which is especialy problematic given the surge in inflation (as the 'real' wage slumped 3.1% in April) As Goldman warns, we caution against excessive expectations for sustained wage growth.
Via Goldman Sachs,
Basic wages still falling even after spring wage negotiations; total wages lifted by special wages/overtime: April total cash wages rose 0.9% yoy, accelerating from March (+0.7%). Special wages increased 20.5% yoy (March: +10.3%), pushing up the total by 0.6 pp. Overtime pay has underpinned wages as a whole recently but is beginning to peak out, although it still rose 5.1% in April (March: +5.8%) and contributed +0.4pp to overall wage growth.
Meanwhile, basic wages (80% of the total) remained on a yoy downtrend (April: -0.2%; March: -0.3%). While wage hikes resulting from the spring negotiations (shunto) will be largely reflected in basic wages, the April figure indicates no major change in basic wages since the start of the new fiscal year. Next month’s May data should shed more light, as many companies will include the shunto wage hike portion in salaries from May.
...
Part-time employees rise, regular employees show signs of peaking: Employee numbers have been growing stably, with the April figure coming in at +1.3% yoy (March: +1.2%), consistent with other employment-related economic indicators. The breakdown shows growth in part-time workers coming in at +2.8% yoy in April, accelerating from +2.1% in March, but growth in regular employees slowing to +0.6% (March: +0.9%), pointing to signs of a peak.
Focus on basic wages and overtime from May: It comes as a surprise that basic wages contracted in the first month of the new fiscal year despite the shunto wage hikes. Since many companies pay new-FY wages starting around May or June, we focus on the basic wage trend from next month...
Considering that there has been no change in basic wages so far, employment growth is skewed toward part-timers, and also continued increase in overtime wages, we think companies remain cautious on expanding fixed cost, i.e. full-time employees and basic wages, and are responding to cyclical activity growth by taking on more part-timers or increasing overtime hours. We caution against excessive expectations for sustained wage growth.
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forcing people to pay higher prices as wages stagnant because end user demand blows for all non essential items has been the answer for 20 years for Japan. It's working so well for them, our clueless Econ PhD's are going the same course.
The Federal Reserve's grand Keysian printing plan is blowing up in their face. Those cocky PhDs won't admit it.
What's the problem? I see green shoots in that chart.
Those are the radiation spikes...
April total cash wages rose 0.9% yoy, accelerating from March (+0.7%). Special wages increased 20.5% yoy (March: +10.3%),
LOL who got the special wages?
Special people.
Goldman warns, we caution against excessive expectations for sustained wage growth... Allow me to translate: FUCK YEEAH BYTCHEZ!!
Dammit, they need to pass a law making the min wage $15 ( not sure how many Yen that is). That'll fix the problem!
with all the free shit giveaways people will be working for $5 an hour cash under the table and making the equivalent of $50K per year. #WINNING!
OT but wanted to share..this morning hubby had faux news on and there was news coverage on a millionare who put money out in various locations and tweeted it for people to find. You should see all the crazy people out looking for money. All I could think of is how badly this all will end once the global financial institution pukes.
Last year I was asking a raise to my boss. I knew from our union guys that he makes about 2.7 million a year so I thought, I'm reporting straight to him, this should be a ball in the park.
So after a discussion of about a hour, I got a 100 euro raise...
I told myself: fuck this, I'm sick of this begging, I'm starting my own bizz and I'm going to steal his clients.
Long story short: He lost a shitload more than 100 euro's a month now that I'm gone and I make a shitload more since I'm gone.
I knew I could make more and I also knew I wouldn't get much more where I was.
So anybody who wants more than 15 dollars a hour but only wants to flip burgers... get the fuck out of there and look for a real job of begin your own bizz.
Don't know what to do?
EASY!!!
Step 1: Buy yourself a baseball bat.
Step 2: Smash that TV
Step 3: Take a piece of paper and a pen and start thinking.
Wages down, inflation up, taxes rising and 250% debt/GDP. If that's not heaven on earth, surely they can see it from where they are.
I think you've given the answer to the US problem right there!!!
THE US NEEDS MORE TEENAGE HOOKERS!!!
Works well in Europe. Hookers and Drugs are now a major part of our legit economy.
And it's a gift that keeps on giving because those numbers are "estimates".
Need more GDP? Raise the estimates!! And all those smart funds get another reason to buy more bonds so the states get more money.
so inflation go up is 3,4% april
and wages is falling. 3,1% april
gap becoming wider and wider
what to do what to do?
The race to the bottom and the return of feudalism continues...
hedge accoprdingly...
Growth - growth - growth. Keep selling it. Pushing it. Must have growth. Growth at all costs.
Cue the 830-ish gold smash.
Of course Inflation aka currency debasement is the tool used to sheer the sheep
China explores bond buying in first hint of QE
http://www.telegraph.co.uk/finance/china-business/10868381/China-explore...
Declining wages are the only real deflationary forces out there, and despite what they say TPTB are happy with that situation. Slave planet bitchez!
Higher prices and falling wages? Welcome to America, Japan.
Obam-Abe-nomics ... para todo el mundo.
well of course the answer is for central banks to drive inflation so that fewer can afford to pay for things.
that surely will drive corporate sales and ultimately earnings.
get it? exactly, neither do I. deflation is here folks and has been for some time.
What cracks me up is that they want price inflation in a stagnant-to-declining wage environment, and then they can't figure out why consumption is in the toilet and there is no confidence.
Is it really that fucking tough for these clueless assholes to figure out? I'll put it in words those braindead fucks might comprehend: "people no got money to pay higher prices for shit that ain't necessary, and they barely have money to pay higher prices for shit that is necessary" you stupid Ivy League cunts.
the reality is that juicing the system keeps the bankster heads happy and well paid - high stock prices are good for those who own options from 2009 - friends in high places.
Japan continues to slide towards an economic abyss with each passing day. The writing is on the wall. Japan is facing a wall of debt that can only be addressed by printing more money and debasing their currency. This means paying off their debt with worthless yen where possible and in many cases defaulting on promises made. Japan's public debt, which stands at around 230% of its GDP and is the highest in the industrialized world.
The moment the Japaneses stock market fails to rise enough to offset inflation this will turn into a tsunami of money fleeing Japan and constitute the end of the line for those left holding both JGBs and the yen. This has been a long time coming and I contend the cross-border flow of money leaving Japan is why some stock markets have remained so resilient . When Japan crumbles it will be felt across the world. More on this subject in the article below.
http://brucewilds.blogspot.com/2014/05/japan-sliding-towards-abyss.html
I think TPTB need to cap Gold here a little tigher.....
Note the Snark.
That's the plan, is it not?
If scheme was to boost exports by weakening Yen
in race to bottom, thus making the Japanese work more cheaply
and exchange their goods for ever more fiat US dollars ,
and use the dollars in financing the empire
and also to buy the chief US export, military hardware.
... Is not that indicative of occupied Japan's vassal state status?
Abe is an enabler, to outward appearances duped by a dream that Japan's glory
will come with a revived militarism (albeit as a handmaiden for the US).
Or maybe he realizes it is all a scam, a racket, and is happy
just enriching himself and his cronies.
Drive up prices and reduce wages so people can no longer afford your products. When it ends demand for boiled rope, guns and ammo will be very strong.
In the fine print the total cash wages are up 0.9% yoy. Why don't you show that graph? Too upbeat for this site?
I don't think even the geniuses at Goldman can understand the nature of the Japanese labor situation, tied at the hip to their culture. It is much worse than these figures indicate. The 4% unemployment rate is a lie. The rate of inflation is a lie. The people are culturally bound to ignore the lies (like Fukushima) of their leaders, keep their heads down and hope things get better. The individual bears the private shame of problems caused by the government.
The political and economic structure of the nation is all based on the concept of "wa." The current meaning of the concept is "harmony." It was, like language and Confucianism, borrowed from the Chinese. The Chinese meaning is 'submissive people" which is probable more apt now (both for the majority of Japanese and Americans).
Sadly, neither definition seems wholly beneficial in the current situation.
That's about right. That "overtime" line is a bunch of BS too. Most are already working fucking 10 to 14 hours a day!
Japonese are a elderly, dying people.
Only Shovel Ready jobs will be undertakers.
What Japan needs is to get rid of Abenomics and continue with its years of deflation.
Lowering the cost of its goods will make it more competitive with China and Korea etc.
japan is fucked
i'm usually disagreeing with ZH posts later so i just wanna say something positive for once
and that's that Japanese are the most apathetic complacent lethargic people i've ever met
and the worst part is they do it with such a in-denial fake sense of politeness that gives them a sense of excuse for all their social historic and ecomic poisons that only grow their lethargy and apathy each year.
just see their demographic and marriage/sexual relationship trends
it's no wonder Abe is trying to to turn to nationalism to inject any resemblance of life into the country
and it's no wonder that it's always failing miserably
i liked how Kyle Bass quoted the common expression over there: "it cannot be helped"
that sums up Japan perfectly. especially when you picture it with a big fake smile.