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gasket37

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http://www.smh.com.au/news/opinion/its-bee...ge#contentSwap1

"For the last four years the Bank of Japan has been injecting 35 trillion yen [$420 billion] into the monetary system per day - that's seven times more than the system actually required." :blink:

one thing i've never understood about the events of the last few years is the differing attitudes towards the money supply.

when the US is printing the stuff like crazy, it is perceived to be a bad thing whereas when japan does it, no-one seems to care??

granted japan has been trying to avoid deflation - so why hasn't this turned into a big blow off into property like the UK/Ireland/Australia etc etc?

again, japan has had an enormous property bust since 1990 - perhaps the scale of it was so big that it is difficult to comprehend - e.g. value of the imperial palace outside lavvy in 1988 being more than that of california or some such cliche! :lol:

do comparisons to weimar germany spring to mind? - i know nothing of japan's trade figures (presumably in surplus) but i seem to remember that government debt is horrific (there was an article that i seem to recall reading that said that japan's debt has a worse credit rating than that of botswana. :unsure: ) again, there have been a lot of keynesianist-style public works projects AFAIK...

sorry - this post is a bit of a ramble but i thought some of the HPC economist wonks could run their slide rules over it!

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http://www.smh.com.au/news/opinion/its-bee...ge#contentSwap1

"For the last four years the Bank of Japan has been injecting 35 trillion yen [$420 billion] into the monetary system per day - that's seven times more than the system actually required." :blink:

one thing i've never understood about the events of the last few years is the differing attitudes towards the money supply.

when the US is printing the stuff like crazy, it is perceived to be a bad thing whereas when japan does it, no-one seems to care??

granted japan has been trying to avoid deflation - so why hasn't this turned into a big blow off into property like the UK/Ireland/Australia etc etc?

again, japan has had an enormous property bust since 1990 - perhaps the scale of it was so big that it is difficult to comprehend - e.g. value of the imperial palace outside lavvy in 1988 being more than that of california or some such cliche! :lol:

do comparisons to weimar germany spring to mind? - i know nothing of japan's trade figures (presumably in surplus) but i seem to remember that government debt is horrific (there was an article that i seem to recall reading that said that japan's debt has a worse credit rating than that of botswana. :unsure: ) again, there have been a lot of keynesianist-style public works projects AFAIK...

sorry - this post is a bit of a ramble but i thought some of the HPC economist wonks could run their slide rules over it!

I have limited knowledge on economics, but I did live in Japan from 2000 - 2003. I know that a weak Yen helps exporters and that has been the main reason for the economy to recover in the last two years. Japan is still an industrial nation, much more so than us, and this is where most of their economic wealth comes from.

10 years of depreciating property in Japan has meant fear has kept people from thinking it will ever go up again (the opposite to our country now). I found this very frustrating there because I could see that buying a flat with a very low cost mortgage in a stagnant property market and national economy was a clear LOW RISK - HIGH REWARD strategy. None of my Japanese friends agreed. It was doubly frustrating for me as I could not buy as a foreigner! A form of racism you could argue - it doesn't feel good to be discriminated against, I can promise! Anyway, as an example of how much prices fell, my friend Makato in Hiratsuka bought his two bedroom flat in 1995 for 16 million Yen. By 2002 it was worth 9 million. Maybe its no wonder he didn't believe me.

All else I can say is that Japan does have a huge deficit and that the economy didn't turn round for years in part to bad loans the banks were left with after the Asian Tiger economies crashed in the late 90's. This lead to a big reduction in interest rates, in part to allow banks to afford paying interest on saving accounts (most Japanese are savers, not borrowers).

Hope I've helped!

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I have limited knowledge on economics, but I did live in Japan from 2000 - 2003. I know that a weak Yen helps exporters and that has been the main reason for the economy to recover in the last two years. Japan is still an industrial nation, much more so than us, and this is where most of their economic wealth comes from.

10 years of depreciating property in Japan has meant fear has kept people from thinking it will ever go up again (the opposite to our country now). I found this very frustrating there because I could see that buying a flat with a very low cost mortgage in a stagnant property market and national economy was a clear LOW RISK - HIGH REWARD strategy. None of my Japanese friends agreed. It was doubly frustrating for me as I could not buy as a foreigner! A form of racism you could argue - it doesn't feel good to be discriminated against, I can promise! Anyway, as an example of how much prices fell, my friend Makato in Hiratsuka bought his two bedroom flat in 1995 for 16 million Yen. By 2002 it was worth 9 million. Maybe its no wonder he didn't believe me.

All else I can say is that Japan does have a huge deficit and that the economy didn't turn round for years in part to bad loans the banks were left with after the Asian Tiger economies crashed in the late 90's. This lead to a big reduction in interest rates, in part to allow banks to afford paying interest on saving accounts (most Japanese are savers, not borrowers).

Hope I've helped!

Foreigners can now get mortgages in Japan even without permanent residency.

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Foreigners can now get mortgages in Japan even without permanent residency.

That's incredible! Can I ask how you know this and how one would go about it?

IF it is true now its a bit of a shame because I think the Japanese property market has improved recently and when I was there it was probably the bottom of the market. Do tell all anyway.

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All else I can say is that Japan does have a huge deficit and that the economy didn't turn round for years in part to bad loans the banks were left with after the Asian Tiger economies crashed in the late 90's. This lead to a big reduction in interest rates, in part to allow banks to afford paying interest on saving accounts (most Japanese are savers, not borrowers).

which kind of explains why prices have remained in the doldrums........

Edited by Milkshock

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Yes, it's true - foreigners can now get Jap mortgages. You need to be resident though (i.e. have a work visa, I believe), but not permanent-resident. There is one bank that I know that does foreigner mortgages (Shunseki Bank or something similar), but the transaction costs for buying are very high.

I'm in Tokyo and I know some Japanese who are active in the property market here. They all say that the bottom was reached in 2004 and has been moving up slowly since.

Cheers,

John

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  • 301 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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