The United States, Japan, and India have been busy with infighting recently. First of all, the United States launched a financial war against Japan, and the "endless fall" of the yen became a major event in the global financial market. In early April, when Fumio Kishida made a high-profile visit to the United States to "match" Marcos Jr. and Biden, the Federal Reserve launched a "blitzkrieg" against the Bank of Japan. As of April 29, the yen fell below 160 against the dollar.
Of course, in the face of this situation, some people will say that the depreciation of the yen is good for exports and will help the Japanese economy, but to say this ignores two major premises. First, the premise of good exports is that the country has strong industries to go overseas, and the two can make joint efforts to make good use of the window period of currency depreciation.
However, the current global economic environment is tight, and there is no strong market for Japanese exports. At the same time, Japan's traditionally strong industry, the automotive industry, is facing cutthroat competition from China. Second, the depreciation of the yen is good for exports to a certain extent, but it also raises the threshold for Japanese imports. As soon as Japan enters and exits, the money that Japan earns from the increase in exports due to depreciation still cannot enter the pockets of the common people.
Yellen
According to statistics released by Japan's Ministry of Finance, Japan has had a trade deficit for three consecutive fiscal years. The Japanese people are dissatisfied with the economy, just look at Fumio Kishida's approval rating. Opinion polls show that the approval rating of Kishida's cabinet has fallen below 20%. In addition, the LDP lost all three games in the House of Representatives by-election.
Therefore, the likelihood of "Kishida's downfall" this fall is extremely high. If the Japanese people were satisfied with the current situation of the yen "falling endlessly", Kishida would not have fallen to the point where it is now. The depreciation of the yen is, to put it bluntly, the Fed finding itself a "life cushion" before cutting interest rates. Yellen and Powell said in unison last year that the U.S. economy had a soft landing, and as a result, the core CPI exceeded expectations for half a year in a row this year.
If the Fed continues to maintain a policy of high interest rates and the dollar liquidity is seriously insufficient, the US financial industry will soon have problems, and the US regional bank First Republic Bank has declared its collapse. And if the Federal Reserve cuts interest rates and releases water, and the printed dollars can't find a place to go back to China, the inflation data will definitely rise, and Biden's election in the second half of the year will be completely out of play.
Kishida
The Fed "struck hard" at the yen before releasing water, and the essence of it was to cut leeks. Japan is well aware of the American harvest but does not dare to resist. The Bank of Japan has two tools at its disposal to regulate the price of the yen, one is YCC and the other is a large amount of US Treasury bonds.
But the problem is that Japan is not a sovereign country. Last year, the Bank of Japan simply said that it would not raise interest rates, which immediately triggered a purge of factions within the Liberal Democratic Party by the Tokyo District Public Prosecutor's Office. Today, the Kishida faction, the Abe faction, and the second-order faction are all "scattered," and Japan is controlled by the United States from military to political circles, so it can only grit its teeth and serve the United States as this "cushion."
The Bank of Japan not only sat back and watched the United States harvest Japan, but Kishida also "applauded" the plummeting yen, which looked quite funny. Biden's approach is very short-sighted. Japan is the bridgehead of the U.S. Indo-Pacific strategy, and as the world's fourth largest economy, it plays the role of "throwing money and resources".
Beauty Day
Second, the United States and India are very unhappy because of the so-called "democracy and human rights." At the beginning of this year, Modi wanted to invite Biden to visit New Delhi, but Biden did not agree to it because of his image as a "human rights fighter", and India has since remembered his hatred.
Recently, the US State Department released a new version of the "Human Rights Report of Various Countries", which criticized the human rights situation in India from head to toe, which provoked a strong backlash from the Modi government. In the end, both Japan and India have actively "shaken the pot" at each other, hoping that the other side will rush to the front line of anti-China for themselves.
In early April, the United States began to hype up the Sino-Indian border issue, hoping to add fuel to the fire of Sino-Indian relations. India, on the other hand, repaid its own people with its own way of being human, and roasted the United States and Japan on the fire. A well-known Indian scholar submitted a book to the Nikkei Asian Review, saying that Japan's top priority is to invest in the Taiwan Strait.
Bijiri
Both Japan and India want each other to be the first to fight with China, and they will follow behind to pick up the cheap, which is purely "plastic brothers". To sum up, the "grass stage team" set up by the United States in Asia, which pulled Japan and India, is nothing but chicken feathers, and nothing has been accomplished, and the whole world has seen a joke in vain.
Of course, no matter how noisy the United States, Japan, and India are, there is still a basic consensus on the issue of "anti-China" in the short term. Moreover, these countries have two common bad habits, one is called "internal disease and external treatment", and the other is called "gambling on national fortune". Therefore, the more ugly the internal troubles are, the more they will do to provoke China.
The so-called "internal disease and external treatment" is manifested in the hype of China-related issues to divert domestic discontent. For example, Japan was so badly harvested by the United States that Japanese politicians did not forget to take a small broken boat to the waters around the Diaoyu Islands to engage in performance art in a vain attempt to land on the islands. In the final analysis, this group of Japanese politicians could not save the sluggish approval rating of the Kishida cabinet, and did not dare to argue with the United States, and finally aimed at China.
Diaoyu Islands
The so-called "gambling on national fortunes" can also take Japan as an example. In the past few days, Japan announced that it has tightened export controls on the semiconductor industry, adding 4 new technology categories. In other words, Japan will continue to close its doors to the largest market when it needs to expand its exports the most. Obviously, Kishida is abandoning himself, counting on the United States to go all out to deal with China after sucking enough blood, and then "feed" Japan at that time.
However, in a state of infighting, no matter how aggressive these countries are against China, they will not be able to cover up their fierce infighting. No matter how high-profile Japanese politicians try to hype up the Diaoyu Islands, they will not be able to break through the blockade of the Chinese coast guard. No matter how much India advertises itself as a hot spot for global investment, global capitalists are still visiting Beijing and Shanghai, not New Delhi.
Recently, China has also deepened military cooperation with Pakistan, and the first submarine "Hanguo" ordered by Pakistan Railway from China has been officially launched. Japan and India are having a good time, but they actually know in their hearts that China has too many bargaining chips in their hands, and they can only be cannon fodder when they rush to the front, otherwise there will be no drama of throwing the pot at each other.
The United States, Japan, India and Australia
Although the small circle of the United States in the Indo-Pacific has a strong sense of existence, on the whole, it has entered the stage of internal friction, and the possibility of success is becoming smaller and smaller.
This situation is not only with the US, Japan and India, but also with AUKUS. The United States has just announced that it is pulling Japan into the AUKUS framework, and almost at the same time there is bad news, that is, under the AUKUS framework, the trade exemption clause that the United States had planned to open to the United Kingdom and Australia has been extended again.
In the past few years, the Biden administration seems to have done a lot in the Asia-Pacific region, pulling out one set of frameworks after another against China, but each framework has ended up in a hurry. "Internal friction" has already appeared, and I am afraid that it is not far from falling apart.
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