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Oh Dear, Japan's Outlook Goes " Very Severe"

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http://uk.finance.yahoo.com/news/BOJ-Shirakawa-warns-Japan-reuters_molt-2103031529.html?x=0

BOJ Shirakawa warns Japan economic outlook "very severe"
Kihara, 5:45, Saturday 30 April 2011
TOKYO (Reuters) - Bank of Japan Governor Masaaki Shirakawa said on Saturday that the country's economic outlook was very severe and that the central bank would take appropriate action to support the economy.
But he offered few clues on whether and when the BOJ would expand its asset-buying scheme, only saying that its next policy step would depend on economic conditions at the time.

There we were all thinking that its only the US who are in trouble. This thing is going global and we should see a massive commodities bust this side of Crimbo followed by a relapsed structural banking melt-down. The bubble party is soon to end I am afraid. :( *

* :o

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Its getting painful to watch Japan. They could completely come out of their problems if they were willing to give out money to their people. But culturally they just can't do it.

Money is a medium of exchange. Without money people can't participate in the economy. You could have great ideas or be a hard worker with a skill others want.. but if they are broke it doesn't matter, you are broke too.

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Japanese manufacturing base looks like it's going to take a huge hit as a result of the quake damage and the far more severe problem of Fukushima which is triggering rolling power cuts.

The govt can't afford for GDP to collapse with it's debt to GDP ratio already at 225%.

Still nothing a bit of printy printy can't fix...

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Its getting painful to watch Japan. They could completely come out of their problems if they were willing to give out money to their people. But culturally they just can't do it.

Money is a medium of exchange. Without money people can't participate in the economy. You could have great ideas or be a hard worker with a skill others want.. but if they are broke it doesn't matter, you are broke too.

Not quite Japan needs to resolve its Zombie bank problem and accept the pain. Giving the proles of Japan freshly printed money will not solve any of there problems. It certainly won't help them fix a fatally crippled nuclear power plant.

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The Japanese situation is being played down by a huge factor by the media.

A large chunk of the global supply chain for many products needed by many industries is knackered.

Those on here who know how to make money speculating on the short-term performance of companies could probably make a fortune.

Those of us who don't, and whose livelihood depends on this supply chain (myself included) are facing an interesting and challenging future...

XYY

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Those of us who don't, and whose livelihood depends on this supply chain (myself included) are facing an interesting and challenging future...

XYY

Yep .. even on a short timescale stuff is not available .. I quoted for a job using 5 cameras made by canon .. Fortunately I put a proviso in the quote of "If I could get them" .. by the the time the client confirmed there were four left in the country .. and I found one second hand ..

So much gear is now unavailable that I've gone back to using film for one job ..

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The Japanese situation is being played down by a huge factor by the media.

A large chunk of the global supply chain for many products needed by many industries is knackered.

Those on here who know how to make money speculating on the short-term performance of companies could probably make a fortune.

Those of us who don't, and whose livelihood depends on this supply chain (myself included) are facing an interesting and challenging future...

XYY

Spot on!

Central banks can print up money on demand, what they cannot do is create goods.

We're probably more dependent upon the Japanese supply chain that we realise. One would hope that our wondrous leaders have given some careful conisderation to this, but I suspect it is almost certain that they haven't.

If Japan goes t1ts we're all going to be in trouble very rapidly, and not just 'cause we have to wait longer for a new Toyota. :ph34r:

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Tbh I think Taiwan and Korea will be able to take up the slack.... a few days after the Japanese quake Apple moved some production to Taiwan.

Taiwan has factories mothballed due to outsourcing to China. Taiwan also has an unemployment problem 6% and a fairly big underemployment problem too. Korea has much the same issues.

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Tbh I think Taiwan and Korea will be able to take up the slack.... a few days after the Japanese quake Apple moved some production to Taiwan.

Taiwan has factories mothballed due to outsourcing to China. Taiwan also has an unemployment problem 6% and a fairly big underemployment problem too. Korea has much the same issues.

I hope you're right ken, and yes, the countries you name are already taking up the "slack" that you refer to. You might also want to include locations such as Singapore.

Problem is, in some sectors - microcontrollers for example - the "slack" that needs filling is 60% of world supply. And the way these devices are made means that even if all these moth-balled factories go into 24/7 production tomorrow, there will be a black-hole of no parts available for months.

There are a lot of products out there crammed full of Japanese microcontrollers - every control system on a modern car is absolutely dependant on them - and those without the "clout" of Apple may not be able to get their grubby paws on them.

Interesting times ahead...

XYY

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It'll be interesting to see in a world of climbing oil prices how much transport costs will be factored in should firms start moving production out of Japan.

Surely we're getting closer to the point again of having the benefit of your supply chain closer to your factories and consumer base, rather than on the other side of the world.

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It'll be interesting to see in a world of climbing oil prices how much transport costs will be factored in should firms start moving production out of Japan.

Surely we're getting closer to the point again of having the benefit of your supply chain closer to your factories and consumer base, rather than on the other side of the world.

So you are arguing that we should completely reorganise the world economy to account for the relatively minor disruption of an event that hits a volcanic island once every 200 years?

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Its getting painful to watch Japan. They could completely come out of their problems if they were willing to give out money to their people. But culturally they just can't do it.

Money is a medium of exchange. Without money people can't participate in the economy. You could have great ideas or be a hard worker with a skill others want.. but if they are broke it doesn't matter, you are broke too.

yes, a medium of exchange.

in order to get some, one needs to exchange something for it...otherwise, its not an exchange.

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Speculating in the supply chain loss is pointless unless you know what you're doing. To the guy who suggested buying a load of memory chips, as far as I can tell most of the worlds supply comes from sources outside Japan.

Most memory IC's are generic anyway, in the respect that you can get drop in replacements from other manufacturers.

Microcontrollers are more of a problem, itrt you would design a whole system around a particular microcontroller, unless you can get hold of that IC it's a long term effort to design in a replacement.

So far I've seen some issues reported with base level passives (capacitors) but nothing irreplaceable. I suspect that if the supply of microcontrollers becomes an issue there will be outsourcing of production (bit like the fabless production models). This will take time to ramp up, but nowhere near as long as building a new fab.

I don't know how the fabless model works economically, but I suspect that they sell themselves to whoever gives them the most cash. So if there is a particular IC that is holding up a production line (say for a car manufacturer) all that manufacturer has to do is wade in with some cash to get the chips made. Because they have the clout of volume they will go to the head of the queue.

So I reckon it's less likely to have an effect on high volume chips, and more likely to have an impact on the low volume specialist stuff that currently uses the fabless model but will now have to compete with more lucrative volume stuff that will be presented and steal fab time.

All this is speculation of course. If the microcontrollers can't be outsourced to different production lines then you're screwed, but I think this is unlikely.

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Tbh I think Taiwan and Korea will be able to take up the slack.... a few days after the Japanese quake Apple moved some production to Taiwan.

Indeed, the main economic impact seems to be reduced sales into the Japanese market...

'Disaster in Japan hasn't greatly affected Apple's supplies, COO says':

http://www.appleinsider.com/articles/11/04/20/disaster_in_japan_hasnt_greatly_affected_apples_supplies_coo_says.html

Apple Chief Operating Officer Tim Cook said the earthquake and tsunami disaster in Japan did not have a material impact on the supply or availability of components for Apple's iPad 2 or other products last quarter, and he also does not expect the situation to affect the company in the near future.

The real economic impact on Apple from the disaster in Japan will come from sales. Apple has adjusted its expectations down $200 million, represented in its guidance for the June quarter. But Cook noted in his company's quarterly earnings call Wednesday that the economic effects of the disaster in Japan "pales in comparison to the human impact."

[...snip...]

Cook revealed that Apple's employees have been working "around the clock on contingency plans," to ensure that the company will be able to secure components if deals were to fall through in Japan. But he also said he would prefer to stick with Apple's long-term partners in Japan if possible -- something he said he expects will take place in most cases.

"They have displayed an incredible resilience that I have personally never seen before," he said.

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Tbh I think Taiwan and Korea will be able to take up the slack.... a few days after the Japanese quake Apple moved some production to Taiwan.

Taiwan has factories mothballed due to outsourcing to China. Taiwan also has an unemployment problem 6% and a fairly big underemployment problem too. Korea has much the same issues.

6% , thats an unemployment 'problem' the US , UK , Spain would love to have :lol:

I still see heaps of Taiwan stuff in the shops although i believe they do most of the manufacturing work in China now and then do a small amount of finishing in Taiwan , maybe just sticking the 'Made in Taiwan' logo on or something.

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Speculating in the supply chain loss is pointless unless you know what you're doing. To the guy who suggested buying a load of memory chips, as far as I can tell most of the worlds supply comes from sources outside Japan.

Even the big guys get caught out with speculation

http://www.azom.com/news.aspx?newsID=104

Published on April 2, 2002 at 11:33 PM

After losing over $1 billion on palladium, Ford is planning to sell some of its stockpile of the precious metal.

Palladium is used in catalytic converters for automobiles and is also alloyed with other metals and used in catalysts. Losses accredited to palladium were attributed to two factors, improving technologies and the fact that the value of palladium has dropped significantly to US$400 per troy ounce from US$1500 which Ford paid

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http://www.azom.com/news.aspx?newsID=104

Published on April 2, 2002 at 11:33 PM

After losing over $1 billion on palladium, Ford is planning to sell some of its stockpile of the precious metal.

How have they 'lost' money, exactly? They should just keep the stockpile of real metal. Far better than exchanging it for dollars at this point in time, I would think.

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Japanese manufacturing base looks like it's going to take a huge hit as a result of the quake damage and the far more severe problem of Fukushima which is triggering rolling power cuts.

The govt can't afford for GDP to collapse with it's debt to GDP ratio already at 225%.

Still nothing a bit of printy printy can't fix...

A good lesson missed from Fukushima is as a nation its a good idea to have a large surplus of power stations. So if one major one get taken out it doesn't lead to rolling blackouts.

It used to be the national power company had capacity 20% above the highest load day of the year.

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How have they 'lost' money, exactly? They should just keep the stockpile of real metal. Far better than exchanging it for dollars at this point in time, I would think.

They bought at $1500 and sold at $400. I think thats considered a loss, even in these weird times.

That was in 2000/1 when the price of oil/gold/palladium etc etc was determined by those old fashioned things called supply and demand of a commodity rather than the assumption that hold on to something for long enough and helicopter Ben will make sure you get your money back and then some.

even now its nowhere near $1500, as an operating business having a few billion tied up in something thats not doing anything, 10+ years is a long time, at various points after 2001 it fell to under $200

http://www.kitco.com/charts/livepalladium.html

http://www.kitco.com/scripts/hist_charts/yearly_graphs.plx

http://www.stillwaterpalladium.com/priceJM.html

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  • 312 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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