Yen went on a free fall to a 24 year low yesterday. It is the third largest fiat currency in the world. Japan is also the largest holder of US treasuries.

  • ednice
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    2 days ago

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    • silent_water [she/her]
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      2 years ago

      there's a recession happening, it's global, the central banks can't avoid it by manipulating interest rates, and prices are going to rise throughout it for most of the world.

      • GundamZZ [he/him]
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        2 years ago

        Reading this Zerohedge piece on it, it seems like Japan's been buying back bonds by a large amount since 2013. Exactly one year after Shinzo Abe returned to Prime Minister. His Abenomics was basically an inverse of China's 5 year plans where instead of investing in infrastructure and real wealth generation (i.e. productive capacity) it's made it easier and necessary for companies to financialize and rip more value from workers in Japan and maybe a mild amount of automation of labour.

        Specific image: https://assets.zerohedge.com/s3fs-public/styles/inline_image_mobile/public/inline-images/JGB%20purchases.jpg?itok=_d64GLzD

        Article: https://www.zerohedge.com/markets/japan-verge-systemic-collapse-dramatic-unpredictable-non-linearities-financial-markets-bank

        I remember reading dipshit Noah Smith try to defend it on the Japonisme website and even he couldn't really make a good case for it outside the usual neolib doubletalk. According to some writing by Michael Roberts Japan's income equality, etc. has all gotten worse over the past 2 decades, especially under Abe, and they can only ride the wave of western imperialism to buttress their consumption. The output of workers in Japan is half that of workers in the US or something. I don't see how they can continue this system they have, it's just constant decline and I don't know if they can keep printing money to buy back bonds forever.

        • scraeming [he/him]
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          2 years ago

          The output of workers in Japan is half that of workers in the US or something

          That's what happens when your country obsessively protects its dinosaur corporate entities to the point that they still use fucking fax machines in the country with the reputation as the most technologically forward-thinking place on the planet. Japan's had an issue with being so hyper-focused on the idea of "if it ain't broke don't fix it" for so long that they rewrote what "broke" means to continue to avoid fixing anything.

          • WideningGyro [any]
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            2 years ago

            Hell Germany has a similar reputation and yet SO many of their large businesses still use fax

          • emizeko [they/them]
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            2 years ago

            it's comical, there are tons of cross-company procedures that cannot be done any other way than by fax machine

        • Homestar440 [he/him]
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          2 years ago

          I remember being glued to zerohedge back in 2011 when it looked like the sovereign debt crisis would be the big collapse. Remember the PIIGS?

      • CommCat [none/use name]
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        2 years ago

        yeah I just got an unexpected email from my Bank, talking about inflation and how to budget your spending. I don't mind another 2008 coming, this system needs a reckoning or we're all doomed in a few short decades.

        • Steve2 [any]
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          2 years ago

          I starter "investing" in January from a windfall and putting $100 away a month into an index fund. The market started collapsing pretty much right away, I'm considering my continuous investment as a real magic hex to collapse the economy and there is nothing they can do to make me stop. I will destroy the capitalist economy and if it just cost me $100 a month to do it, we'll that's just my cross to bear.

          • Prinz1989 [he/him]
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            2 years ago

            I also started in January. Lost 1000€ in the last week alone.

            That money could have bought a lot of premium booze, the only 40% I'm going to see anyway.

        • silent_water [she/her]
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          2 years ago

          a reckoning means the world finds a new dominant ideology -- whatever new form of liberalism replaces neoliberalism -- and a contingent economic policy that opens up new markets for exploitation... or... we're all gonna be enmeshed in war for decades. kinda hoping this one turns out not to be the big one just cause I was planning on a couple more years to prepare...

            • cawsby [he/him]
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              2 years ago

              Tons of dried food like white rice, beans, whole corn, etc will last 20+ years if stored below 100f/40c.

              A 5 gallon food-safe bucket is the best choice for storage. They are stackable, vermin-proof, and air/water proof that cost ~$8 with lid at a hardware store.

              Each 5 gallon bucket can hold roughly enough calories for a month of food for one person. If you go with white rice or lentils that can be had as cheaply as ~$25-30 per bucket.

              • Steve2 [any]
                ·
                2 years ago

                This is good for a potential total collapse but also the best prep is honestly to have a community of people you can rely on and trust. Alone and prepped is the same as alone and unprepared.

                • cawsby [he/him]
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                  2 years ago

                  We have them because we live in earthquake country.

                  Estimated time to get power back to our property after the Big One will be 6+ months.

                  • Kresimir [they/them]
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                    2 years ago

                    The big one refers to that impending earthquake on the northwest coast right?

                    Absolutely wild that there's been basically no preparation for that at a systemic level

                    • cawsby [he/him]
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                      2 years ago

                      There has been some but mostly at city/metro level.

                      Some cities have caches of generators/tents, but most will rely on FEMA.

          • Frank [he/him, he/him]
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            2 years ago

            Turbo-Mammonism, the ideology of throwing kids in to a giant pit to appease the money god.

      • ednice
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        2 days ago

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      • mr_world [they/them]
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        2 years ago

        It's because there's more going on than which can be fixed by interest rate changes. Housing is about the only thing they can affect other than interest rates (because mortgages). They can't do shit for war, supply chain issues, etc.

        • silent_water [she/her]
          ·
          2 years ago

          they're trying to destroy demand to alleviate the supply shortages by raising the cost of money. it won't work because the problems are on the supply side (prices will keep going up as businesses struggle to make a profit) and demand for essentials can only fall so far, but it will have a wonderful impact: the middle classes will be out for blood over the next couple of years. by destroying the fascist economic base, they're ensuring that angry fascist mob takes power.

  • Wheaties [she/her]
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    2 years ago

    :angel-biblical: For this, our second recession of the 21st century -- The Second Dot Com Crash -- The Venture Capital Burst -- or -- That Thing We All Kinda Suspected Was Inevitable -- I predict:

    • increased austerity

    • an investment firm bailout, for our poor small-bean investors whom never expected crypto-securities-currencies to be misrepresented

    • $TSLA is Too Big To Fail. What does that mean for an investment portfolio pretending to be an automobile manufacturer? No clue.

    • Phoenix becomes very dry. Body count dry. Don't expect much coverage of this. It will be like the west coast wildfires of the last two years, another ecological disaster playing second fiddle to a dumber, more easily rectifiable disaster.

    • prediction is a fools game, so here's the only one that counts: Nothing will fundamentally change in the imperial core, but living and working conditions will get worse.

    • W_Hexa_W
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      1 year ago

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        • W_Hexa_W
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          1 year ago

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          • Z_Poster365 [none/use name]
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            2 years ago

            I let her know that I suspect the housing market is in a bubble but ultimately it’s her money and her call

            • W_Hexa_W
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              1 year ago

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              • Z_Poster365 [none/use name]
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                2 years ago

                It’s hard to say too. I bought and sold a little rundown bungalow in 2018-2020. I panic sold during the pandemic because I lost my job and the economy was collapsing and I suspected housing would too.

                I made out ok, but would be in a much better spot today if I kept the house.

                • W_Hexa_W
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                  1 year ago

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                  • Z_Poster365 [none/use name]
                    ·
                    2 years ago

                    Bernie did a similar thing in the US and forced through some pretty nice Unemployment benefits and mortgage deferments.

                    Soc Dems serving their role as being the only sane, competent capitalists and rescuing capitalism from itself.

        • W_Hexa_W
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          1 year ago

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  • Ideology [she/her]
    ·
    2 years ago

    Russia out here like the main character in a martial arts cartoon looking for the weak spots in a boulder to break it with their finger

      • 20000bannedposters [love/loves]
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        2 years ago

        It's almost like if you focus on internal affairs and build a self sustaining economy based on your natural resources it pays off

        • fox [comrade/them]
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          2 years ago

          I see you, I hear you, but what about an economy where the government directly prints money to hand to investors, who then endlessly shuffle it around between each other and bet on various ways they can shuffle it later, and every single job is based on helping to shuffle the money around or sell coffee to the shufflers.

          • 20000bannedposters [love/loves]
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            edit-2
            2 years ago

            Sounds like one of the best economic systems I've ever heard of.

            Forgot my original post. Everything should be based on this type of scheme that will never faulter

  • discountsocialism [none/use name]
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    2 years ago

    They aren't doing what western countries are doing and it's spooking investors.

    Bank of japan is trying to control the interest rate of bonds by buying bonds from the open market. This increase the supply of money which can cause inflation. This worry is probably what is causing the line to go down. It may be justified, it may not be, it's a crazy time and nobody can know what will happen.

    So here's the thing, even if Japan loses their interest rate peg and yield curves go out of control, it may not even matter. People claim that yield curves are predictive of a recession but theres no real reason for it.

    • Lovely_sombrero [he/him]
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      2 years ago

      BOJ has an unlimited bond buying policy. I guess the problem is that a lot of Japan's debt/trade/holdings isn't in their own currency? I didn't really look into it yet.

      • silent_water [she/her]
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        2 years ago

        I don't understand step 2 of this plan. they prop up prices on artificially low yielding bonds, but what does this accomplish beyond inflating the value of the currency away? how will they stave off riots when food, rent, and gas prices spiral out of control?

        • zifnab25 [he/him, any]
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          2 years ago

          they prop up prices on artificially low yielding bonds, but what does this accomplish beyond inflating the value of the currency away?

          The cheap lending keeps businesses from going into recession mode and firing a bunch of people. If money is cheap, labor is also cheap and the incentive is to maintain/grow staff.

          how will they stave off riots when food, rent, and gas prices spiral out of control?

          I mean, Japan is about even on Imports/Exports, so as long as the rest of the world keeps buying their manufactured products, they'll have equivalent cash-on-hand to import food and energy. As to rents, the Japanese population is contracting rather than expanding. So real demand for housing is falling while real demand for labor is rising. The real challenge Japan faces is a foreign investment in housing that drives unit prices up well above what lay residents can afford.

          The consequence of this sky-high real estate cost has been... a collapse in new families and new children, resulting in a tightening labor market and soft floor on housing demand. I would worry less about rioters than squatters in this situation.

        • CoolerOpposide [none/use name]
          hexagon
          ·
          2 years ago

          They don’t. They’ve just kept kicking the can down the road ever since their first bout of stagflation with increasing severity each time

    • mr_world [they/them]
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      2 years ago

      They're trying to change how money moves by buying/selling corporate bonds. The same shit the US government does. The US bond market has been fucked for a few days too. Everyone is trying to take plays from the good liberal economics playbook. We'll see how it turns out.

  • solaranus
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    edit-2
    1 year ago

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  • Fishroot [none/use name]
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    2 years ago

    Time to buy all the anime waifu figurines and sell them at inflated price

    :so-true:

  • zifnab25 [he/him, any]
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    2 years ago

    The US Federal Reserve has an infinite appetite for Treasury Notes. And with rising interest rates, I-Bonds are already trading at a premium.

  • BeingfromInnerSpace [he/him]
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    2 years ago

    So, they sell foreign currency. What do they have to sell? Only the second-largest stash of UST securities.

    :deeper-sadness:

  • Meh [comrade/them]
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    2 years ago

    So you're saying its time to import all the weeb shit you've been eyeing?

    • Steve2 [any]
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      edit-2
      2 years ago

      Finally a box set of any mid 90s anime season will cost less than $80, I knew I was right to play the long game. Only took 30 years.

  • infuziSporg [e/em/eir]
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    2 years ago

    Computer, enhance around the date of the inflection point.

    :putin-wink: