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The United States and China have been battling each other for five or six years, and eventually they are covered in bruises, while China has flourished. Under the combined impact of the U.S. economic and trade war against China and the new crown pneumonia epidemic, China's economy has come out of the trough and sprinted to the commanding heights again. Now that more and more China-Europe freight trains are open, and the support rate for the Belt and Road Initiative is rising.
The hesitant United States and China began to negotiate, and the two countries resolved their disputes in a number of areas.
Although the United States has not stopped its large-scale economic and trade war against China, it is a good phenomenon that the two countries have strengthened their communication mechanisms in response to climate change. If both countries benefit from this, the United States will be even better.
Of course, this is only China's hope, and it is difficult to say whether the United States will turn its face at that time, for example, after the US presidential election and Trump takes office, whether Sino-US relations will deteriorate. For the time being, the struggle between China and the United States has shifted from the open to the back.
The United States moves less toward China and more toward its allies. Last year, Biden wanted to pull Japan into NATO, which was simply a doom to Japan. You must know that during World War II, Japan committed serious crimes against China and the Korean Peninsula, and many crimes in Asia.
Now Japan also wants to seize China's Diaoyu Islands and interfere in China's Taiwan issue, and has also cooperated with the United States to crack down on China in chip exports, and with the benefit of the United States, it has used the Russia-Ukraine conflict to sanction some Chinese companies.
If Japan joins NATO, it will seriously threaten China's security, will Japan become the second Ukraine and fall into the quagmire of war?
It is difficult to say that the United States is harming Japan in more ways than that. Japan thinks that it is an ally of the United States and that it will take its own feelings into account in any policy formulated by the United States, so Japan has bought a large amount of U.S. bonds, becoming a country like China and the United Kingdom, and a country with more U.S. bonds in the world.
Now, however, Japan has suffered a lot because of this decision.
Since 2018, the United States has raised interest rates several times, and the magnitude and frequency of interest rate hikes have exceeded those in the past, which has allowed the United States to return some cash, which can intervene in the high rate of price growth to a certain extent, which has also ruined Japan.
This would lead to a return of Japanese cash to U.S. banks, and Japan would be short of cash, leading to a depreciation of goods.
For China and other large countries, this kind of harm may not appear soon, and they have the ability to deal with it, but Japan is a small country and simply has the ability to deal with it, and the Japanese economy will be completely destroyed.
Japan is already a country with a small market and a shortage of resources, and it simply cannot withstand any heavy hammer. The U.S. approach led to a frenzied shock to the yen's exchange rate, which plummeted against the dollar until it fell below 160, and this happened many times. The last time this situation arose, Japan spent nearly ten trillion dollars.
Judging by various information, it may be that Japan has sold a certain amount of U.S. bonds, rather than printing new currency directly, as the Biden administration did.
Unexpectedly, in less than a month, this money was depleted, and the interest rate in Japan fell below 160 again.
Japan's fifth-largest bank couldn't stand it anymore, and after hearing that the chairman of the Federal Reserve said that it would not cut interest rates in June or July, and that it might not even cut interest rates at the end of this year, the bank decided to start selling tens of billions of dollars of U.S. bonds in its hands this year, and it would take less than a year to empty these U.S. bonds in exchange for cash.
Why is this Japanese bank in such a hurry? Because this bank is the fifth largest bank in Japan, the reason why it can fully become the fifth largest bank is because there are a large number of customers who store cash here, so this bank has a lot of cash to lend, and at the same time has the ability to buy a large amount of U.S. bonds to make money on the interest difference, but I didn't expect this plan to go bankrupt.
Actually, now that the bank is insolvent, why do you say that/A large amount of loans that have been released have not been recovered, and a large amount of cash has been used to buy US bonds, and I have not increased the number of new depositors, and the original depositors have not increased their deposits, and these depositors have sent their cash to US banks to earn interest.
There is even the possibility of withdrawing deposits to the United States to earn interest. If this bank runs out of cash, I am afraid that it will not even be able to pay the salaries of its staff, and this bank is as anxious as an ant on a hot pot, and has to sell US bonds to replace cash, even if this is a loss, but the loss can be smaller, otherwise it will either go bankrupt or be acquired by US assets.
The U.S. has the ability to buy this bank, because there is more and more cash in the U.S., and the money is in the hands of U.S. banks, which can be placed in certain companies or directly merger and acquisition.
Will the Japanese bank be able to stop the U.S. harvest in the end?
It depends on when the US stops raising interest rates, or when it cuts, or how Japanese savers react to the US rate hike policy.
In fact, if the United States harvests assets around the world, and if the United States does not stop raising interest rates, the world's cash may flow to the United States.
The sell-off of US bonds is an emergency solution, and the best way to do this is to change the country's employment situation and increase its ability to export goods.
Why is this a better approach? Because the country's ability to ship goods increases, it can exchange more foreign currency, and it can increase the country's cash reserves to offset the cash outflow, so that prices remain stable.
These foreign currencies will be deposited in the bank, and the bank's ability to use funds will increase, of course, the bank must not continue to buy US bonds after it has money, and do not forget the pain after the scar is healed. What is the use of increasing the employment rate in the country?
Increasing the country's employment rate will increase the country's commodity production capacity, which in turn will increase the country's commodity export capacity.
So how can you change the employment situation in your home country? The first way is to let domestic enterprises expand their production scale, and the second way is to attract foreign capital and foreign enterprises.
The introduction of foreign capital and foreign enterprises is a better way, and there are many countries that have some foreign capital, some enterprises that want to expand the scale of production, and some enterprises that want to open up overseas markets.
If Japan can formulate policies that make other countries feel that the investment environment is better and that there are profits to be made, such as preferential tax policies, low human resource costs and land availability, then companies in these countries will come to invest, just as China used reform and opening up to improve the speed and quality of economic development.
The Japanese economy has always been characterized by a high level of foreign investment and a small amount of foreign investment in Japan.
Japan is a resource-poor country, so many Japanese products are not produced directly in Japan because their production costs are too high.
If the factors of production are imported from abroad, these costs will be passed on to Japan itself, and if other countries invest in Japan, it will be a different situation.
This is because the cost of producing those products will be passed on to foreign companies, and it will be related to the profits of foreign companies, and it will not be related to the changes in foreign exchange in Japan.
However, because local production enterprises in Japan can reduce transportation costs, reduce prices, bring benefits to the Japanese people, and allow the Japanese people to obtain a large number of high-quality and low-cost products, so that the consumer economy can rise, and Japan can increase more taxes.
In other words, although the tax is reduced for enterprises investing in foreign investment, it can maintain the continuous growth of tax revenue through consumption tax and contribute to the national treasury.
Therefore, Japan needs to carry out supply-side reforms like China. The best way for Japan to attract foreign investment is to support China's Belt and Road Initiative and join the circle.
At the same time, we should not do anything that would undermine Japan's relations with its neighbors, and that we should not cause security concerns in neighboring countries, such as the issue of discharging nuclear wastewater, and stop immediately.
We can't continue to discharge nuclear wastewater, which could lead to war, and if war does, how can we talk about a stable investment environment?
On the issue of territorial disputes, we should stop fabricating evidence out of thin air, stop thinking about restoring militarism, and Japan's attempts to join NATO, build up a regular army, and seize the Diaoyu Islands are all undermining Japan's relations with other countries and worsening the investment environment.
Of all the issues, it is definitely a big one for Japan not to discharge nuclear wastewater and no more provocations over the Diaoyu Islands, because it will lead to very bad Sino-Japanese relations.
Japan has been exporting a large amount of aquatic products to China, which has increased foreign exchange earnings for the Japanese government.
If Japan does not stop discharging nuclear wastewater, then China's crackdown on Japan's aquatic product exports will increase, and the time will be longer, how can Japan return to the sky?
Don't think that the United States really treats itself as a human being, because the United States has never looked up to Japan. At the time of the Meiji Restoration, Japan's national power increased, and the United States added a competitor.
In World War II, Japan attacked the Pearl Harbor military base in the United States, which angered the United States, and the United States dropped atomic bombs on Japan and bombed the Japanese capital.
After the war, they also stationed troops in Okinawa, Japan, for a long time, and these garrisons were undisciplined, endangered local law and order, and affected the local economic development.
The land, which could have been used for the development of tourist spots and businesses, was turned into a barracks for the U.S. military. If the United States really attaches importance to Japan and does not treat Japan as cannon fodder, it will not continue to station troops in Okinawa.
The U.S.-Japan security treaty is effectively a piece of waste paper. As long as the United States feels that Japan is of no value to the United States, it will abandon Japan at any time. The treaty was not intended to defend Japan's economy, but to turn Japan into a pawn against China.
Most Japanese people are aware of this, and some Japanese politicians are still confused, otherwise this security treaty would have been thrown away long ago.
Japan has long improved Sino-Japanese relations, allowing Sino-Japanese relations to fuel the economic development of the two countries.
Although the position of the dollar is very solid, the decline of the dollar will be an inevitable phenomenon, and the hegemony of the United States will one day plummet like the hegemony of Britain, so Japan should not pin its hopes on the United States.
China is Japan's best friend, and China's market, China's raw material supply capacity, and China's perfect manufacturing system will speed up the quality and speed of Japan's economic recovery.
What do you think about the beginning of the harvest in Japan? Welcome to discuss in the comment area!
Information sources:
Shandong Provincial Department of Commerce: The yen once fell below the 159 to 1 level against the US dollar