The yen has depreciated sharply, and Chinese tourists have crowded Japanese shopping malls.
The same bag, sold for 10,000 in China, sold in Japan, 7,000 can be won. Some people will say, isn't this not only 3,000 cheaper? With such a small amount of money, it is not even enough for air tickets, is it necessary to go to Japan to buy a bag? However, what if it is 10 or 20 bags? What about bulk purchases? With only 30 percent of the price difference, it is enough for a small wave of people to make a windfall. Some purchasing agents said that they could earn more than 10,000 yuan by going to Japan. There are also travel bloggers who say that in Japan now, it is equivalent to a 7% discount on all assets overseas. Whether it is a hotel, a scenic spot, a house, equity, etc., all of them are discounted, which attracts global investors and tourists from all over the world, and frantically flock to Japan.
In the first quarter of this year, the total spending of tourists visiting Japan exceeded 1.75 trillion yen, equivalent to 81.9 billion yuan, a record high. In March alone, more than 3 million foreign tourists flocked to Japan. In the first quarter, the number of visitors to Japan exceeded 8.5 million. Based on this projection, Japan is expected to receive more than 34 million international tourists this year.
Among them, there are particularly many Chinese tourists. Today's Japanese shopping malls are crowded with Chinese people buying and buying. If you don't look at the landmarks, you don't know and think it's in the country. The key to why there is a large influx of Chinese tourists into Japan is that Japan has depreciated and all luxury goods have been discounted by 7 percent. In 2021, 1 yuan could only be exchanged for 15 yen, but now it can be exchanged for 21 yen. Some Chinese took advantage of the cheap yen and went directly to Japan to buy a house and buy a real estate in Japan. But the difference is that Chinese mainly go to Japan to consume, while Americans mainly go to Japan to invest and buy high-quality Japanese assets.
As early as 2020, Warren Buffett, the American stock god, bought the shares of Japan's five major trading companies in advance, namely Itochu, Marubeni, Mitsubishi, Mitsui & Co., and Sumitomo. After continuous capital increases, Buffett took 9% of the shares of Japan's five largest trading companies. Warren Buffett's intention is very clear, that is, pure financial investment, in order to earn excess profits, not to seek a controlling stake. Warren Buffett specifically emphasized that the total equity share held will not exceed 9.9%.
But under the leadership of Warren Buffett, dollar capital frantically bought the Japanese stock market. Because the more the yen depreciates, the lower the dollar will buy Japanese assets, and the greater the profit margin. In just three years, the market value of the five major Japanese trading companies that Buffett bet on has more than doubled, earning about 76.5 billion yuan, which is equivalent to more than 10 billion dollars. In addition, Japan's five largest trading companies also took out 1/3 of their net profits and paid large dividends. This made Buffett make a lot of money. But in this world, when the wealth of the top rich people exceeds the value, there must be another part of the people who are moving forward with a heavy load. Because the money earned by dollar capital does not come out of thin air, it is the wealth created by the Japanese people.
Who has become the price of the profit of dollar capital? It is the ordinary Japanese. Japan's economy is going through a double battle. On the one hand, the frenzied influx of dollar capital into the Japanese stock market pushed up the Nikkei index and created a boom in the Japanese stock market. But on the other hand, ordinary people in Japan have to bear the risk of serious inflation.
Whether it is RMB capital or US dollar capital flowing into Japan, it will eventually be exchanged for yen. The more the yen depreciates, the more capital of the renminbi and the dollar will pour into Japan, and the greater the amount of yen in circulation. For Chinese tourists and American capital, Japanese assets have become cheaper and can be bought at the bottom. But for the Japanese people, the money in their hands is worthless, and prices have skyrocketed. Because the price of luxury goods is relatively fixed, prices will not easily rise significantly. However, under the depreciation of the currency, daily necessities have been forced to bear inflation, and the prices have continued to rise.
In Japan, a cabbage is sold for 100 yuan. Vegetables, rice, fruits, prices have risen. This is a classic "imported inflation", like when the subprime mortgage crisis erupted in '08, when a large amount of dollars poured into China, pushing up China's housing prices. Today, Japan is suffering from the double influx of renminbi and US dollars, which not only pushes up Japanese housing prices, but also pushes up Japanese prices. At the beginning of April this year, the prices of 2,806 food items in Japan increased, some by more than 25%.
However, the depreciation of the yen has benefited Japan's export trade, because exports are more profitable. Also selling a Toyota car in the United States costs about $20,000. In 2021, $20,000 could only be exchanged for 2.08 million yen. But today, $20,000 can be exchanged for 3.12 million yen. Toyota sold 5.53 million vehicles in the U.S. last year, and the exchange rate difference alone can bring in extremely large profits. It was also the year that Toyota's net profit topped the world, reaching $29.7 billion, more than the net profit of all Chinese auto companies combined.
All Japanese multinational groups have more room to profit in the exchange rate. It is ordinary Japanese workers who can bear this price. Wages have not risen as fast as the yen has depreciated. In three years, the yen has lost 56% of its value. Japanese migrant workers did nothing, and the money in their pockets evaporated by 56%.
However, judging from the historical trend of dollar capital, after pushing up the Japanese stock market, it is inevitable to look for the next target. When the dollar withdraws from the Japanese stocks, the Japanese middle class will have to be harvested. Turkey, South Korea, and Vietnam have already carried this routine once. Japan has neither major industrial innovation nor major technological innovation, and there is a serious bubble in the stock market and consumption boom. Japan is just sacrificing itself and transfusing blood for dollar capital.