National debt is not the people's debt - The country is not a company - Breakdown of government bond holdings that still do not penetrate public opinion.
2024-01-09
Category:Japan
「国債等関係諸資料」令和5年6月末国債保有内訳 Photo by 財務省 (licenced by 財務省 )
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National debt is not a national debt.
The image at the beginning shows the breakdown of Japanese government bond holdings. I sometimes see people say that national debt is the nation's debt or that it is the same as corporate debt, but national debt is the government's debt, not the people's debt. Even if a country is compared to a company, companies do not borrow money from their employees. Debt comes from outside the company, and in this case, it involves purchasing Japanese government bonds from overseas. If most of the debt is overseas, it is natural that the company will default if it cannot be repaid. Purchases of Japanese government bonds from overseas account for ７.３%.
The Japanese government has assets equivalent to its liabilities.
If you really want to say that it is the same as a company, would you say that purchases in Japan are borrowed and borrowed within the company or within the group company? Yoichi Takahashi considers the Bank of Japan to be the same as a subsidiary of the government, and explains that it is the same in terms of consolidation, regardless of whether interest is charged. The Bank of Japan holds ５３.２% of Japanese government bonds. He is well known for introducing BS to show that the country holds government assets equivalent to the government's debts (excluding the holdings of the Bank of Japan). The total amount of government assets ranks first in the world, exceeding both the United States and China. Below is the balance sheet (BS) of Japan.
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Japanese government bonds are debt denominated in yen.
Furthermore, Japanese government bonds are mainly traded in yen, which means that there is no change in value based on foreign currencies. In the case of foreign currency transactions, if the value of your home currency plummets, the face value of your debt will rise accordingly. Suppose your country's currency drops to half its value. Alternatively, if the foreign currency used when trading government bonds doubles, the debt will also double, but since the transaction is in Japanese yen, there will be no effect at all. In an extreme case, former Prime Minister Aso said that repayment would be possible by increasing the number of yen bids. In this case, there will be inflation and the value of the yen will fall, but the theory is that the debt can be repaid because it is the face value of the yen. This was actually said by Taro Aso, a former Prime Minister and former Minister of Finance.
Japan, the world's largest creditor country
Secondly, the Japanese government is also the world's No. １ creditor country. In other words, they have foreign bonds and foreign assets. The fact that we are currently talking about national debt as a problem is actually making a fuss about only the debt part, and in fact, Japan has the most foreign assets in the world. This assumes that the government bonds are denominated in yen as mentioned earlier, and if more yen is printed, the value of the yen will fall and the yen will become weaker. If you do this, overseas assets purchased in dollars or euros will increase in value when converted to yen, so the difference will be a large income. Even with the current depreciation of the yen, a large profit margin was generated due to the increase in the valuation of overseas assets.
Print more yen up to 2% inflation rate
Representative Sanae Takaichi has advocated the ``Japanese Economic Resilience Plan,'' which calls for a temporary freeze on primary balance (PB) regulations and calls for industrial investment through the issuance of government bonds. She says that even if inflation were caused by printing more yen, it would not have a big impact if the inflation rate was less than ２%. Currently, the yen is depreciating due to the difference in interest rates due to the Fed's interest rate hikes, but the original goal is to induce a depreciation of the yen through the issuance of government bonds and increase the number of bonds, strengthen international competitiveness, and increase wages and tax revenues through rising prices. If the manufacturing industry returns to Japan due to the weak yen, GDP and tax revenue will increase, and government debt can be reduced. For now, this is just the effect of a weaker yen due to interest rate differences, but we are already seeing significant results.
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Public opinion without examining Abenomics - there is no point in criticizing it based on contradictory premises.
There are some surveys and opinions in public opinion that Abenomics has ruined Japan, but is that true? First of all, what is Abenomics? Were you asking people who answered the same question as in the poll, or were you asking people you didn't know? I wonder if asking someone I don't know will give me the results I expected. First, let's review the three arrows of Abenomics.
Three arrows of Abenomics
Bold monetary policyFlexible fiscal policyGrowth strategy to stimulate private investment
Monetary policy is still ongoing, but former Prime Minister Abe has said that the consumption tax increase was decided in advance and was carried out at a time when it could not be postponed, so he was unable to fire a second arrow. In other words, Abenomics is actually the first arrow in a variety of environments. In other words, I would understand if there was an evaluation of the fact that it did not advance to the second stage, but I have doubts about evaluating Abenomics itself.
Next, I will list some of the achievements of Abenomics.
Main achievements of Abenomics
The total national and local tax revenue will reach a record high of 107 trillion yen in fiscal 2019, up from 78.7 trillion yen in fiscal 2012. The stock price, which was around 8,000 yen, rose to over 24,000 yen under the Abe administration. Public pension investment profits increased by 57.6 trillion yen in seven and a half years. The effective job opening ratio was 83 job openings for every 100 people in 2012, and 164 job openings for every 100 people in 2019. Business operators improved their treatment due to the labor shortage. The minimum hourly wage rose from 749 yen in 2012 to 901 yen in 2019. The rate of children from single-parent households going on to university increased significantly from 23.9% to 41.9%.
Sanaenomics (Japanese Economic Resilience Plan) will be published. Representative Sanae Takaichi announced a policy to carry on Abenomics during the last presidential election.
Sanaenomics three arrows
Financial easingFlexible fiscal stimulus in times of emergencyBold crisis management investment/growth investment
What they have in common is that monetary easing policy will continue, and if the Takauchi Cabinet is elected, the government will implement aggressive fiscal policy.
The fact that the Japanese government's balance sheet was introduced for the first time in 1995 means that the Japanese government did not have the concept of strategic investment, which companies take for granted. How can you invest without a balance sheet or cash flow statement? It was only a matter of being able to compare the income and expenditure for a single year, or the previous year. The term "primary balance" has come to be used like crazy. At that time, Japan believed that deregulation would revive the economy, and the government repeatedly took the approach of relaxing regulations through legal revisions.
As a result, the Japanese government was unable to rebuild the national economy or make strategic investments for economic growth after the collapse of the bubble, which was an unprecedented economic crisis. More than 30 years have passed since we stubbornly closed the doors. Then, companies moved their manufacturing sectors to emerging countries, and GDP and tax revenues mainly went to neighboring countries such as China, creating a dual wage structure of dispatched labor in order to prevent an increase in the number of unemployed people in Japan. . The economic disparity that arose from this process is said to be one of the causes of the current declining birthrate.
So, has Abenomics ruined Japan? Would that also mean denying Sanaenomics? Or will we continue to turn down investments from the government as we have been doing, paying close attention to the primary balance under the guidance of the Ministry of Finance and listening to the beautiful words of fiscal consolidation? The point of contention should be to gather opinions on whether or not bold fiscal spending by the government is necessary. In any case, regardless of whether the policy is better or not, there are parts where it seems like the point at issue is not policy at all, but just an extension of a personal attack, which is unfortunate.
30 years lost as a result of passive fiscal policy
In other words, those who claim that government debt is bad have the completely opposite idea. What ruined Japan after the bursting of the bubble was rather the primary balance discipline, the inability to focus on single-year income and expenditures and to make long-term investments. Japan tightened its finances in the most critical economic situation. If it is the same as a company, when the company is in crisis, the company's safe is closed like a shell, and for the past ３０ years, the company has been operating in a state of poverty and not being able to make long-term investments. This is the so-called curse of PB by the Ministry of Finance.
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The sealed Greater East Asia War, what is the original meaning of the word Hakko Ichiu?
There are some words that were banned by GHQ after the war. Typical examples include the words Greater East Asia War and Hakko Kazuu.
The Greater East Asia War became known as the Pacific War, or World War II, and many Japanese people have probably never heard of Kazuu Hakko. What exactly was the Greater East Asia War? It would be best to think of it as a war based on Japan's Greater East Asia Co-Prosperity Sphere concept.
Starting with India, Asian countries were colonized by the West one after another over hundreds of years. The countries that were invading these countries were mainly Western maritime nations: Great Britain, France, the Netherlands, Portugal, and Spain. In fact, not a single country in Asia was able to resist this and surrendered its country. In the end, almost all of the vast Asian region became a Western colony, and even China, which was once called a great power, went through the Opium War and the Arrow War, and its major cities were leased out one after another, resulting in a state of divide-and-rule.
It was clear that the opening of the Suez Canal would greatly shorten the sea route that had previously reached Asia via the southernmost tip of Africa, accelerating the division of Asia.
Russia was lagging behind in colonial policy in Europe. The Russian coast freezes over in winter, making it impossible to navigate. Even if sailing is possible during the season, they will have to pass through the narrow strait between present-day Denmark and Sweden, enter the North Sea, and then travel through the English Channel. Even going out into the Atlantic Ocean was influenced by other countries, and Russia was only able to acquire some areas such as Alaska regarding its colonial policy in the Americas.
Russia planned to colonize Asia by land. This is the Trans-Siberian Railway. They used this railway to send soldiers and weapons, colonize Northeast Asia, and transport the supplies they obtained to St. Petersburg. With the completion of this colonial infrastructure, it was clear that colonial policy in Northeast Asia would accelerate. The Trans-Siberian Railway was opened in 1904, and at the same time information was received that the Baltic Fleet, said to be the strongest fleet at the time, was heading for Vladivostok, the terminal station of the Trans-Siberian Railway.
What was the Baltic Fleet planning to do now that it was able to receive supplies from Vladivostok? China? Korea? Of course, it is natural to acquire those areas, but if it is a continent, it will be a land strategy, so do we need a fleet for land routes? In other words, it is clear that the purpose of these ships was to subdue Japan. The Baltic Fleet sank the ship in the Sea of Japan before entering Vladivostok during the Russo-Japanese War and the Battle of the Sea of Japan. In the end, Japan won, and Russia's plans suffered a major setback. The Russo-Japanese War was from 1904 to 1905, and the Trans-Siberian Railway was completed during this war.
Even among Japanese people, there are many who say that Japan waged a reckless war. Is it really reckless? In fact, Japan has defeated all European countries such as Britain, France, and the Netherlands, including in Southeast Asia. If anything was reckless, it could be said that it was the start of war with the United States. Next, there are those who say that Japan invaded Asia. Now let's think about where we invaded. Thailand was the only independent nation in Asia west of China. In other words, the Asian countries that Japan invaded no longer existed in Asia at the time, in the sense that they were self-governing. They were Western colonies, so Japan invaded Britain and the Netherlands. If I had to say it, if we think of the Sino-Japanese War as an invasion of China, then we can say of the Asian countries that they invaded China.
So why is it said that Japan invaded Asian countries? That's probably why the term Greater East Asia War was banned. At that time, the world was about to be divided into European maritime nations. All of the Americas are colonies. What about Australia? What about the African continent? Europe's maritime nations will acquire all of this. Is Asia different? There's no reason for that. Japan is the only Asian nation that has resisted this global colonial policy.
The Greater East Asia Conference was held in 1943. Participants included representatives from Burma, Manchukuo, the Republic of China, Japan, the Kingdom of Thailand, the Philippines, and India. I would like to introduce the Greater East Asia Joint Declaration that was adopted here.
The countries of Greater East Asia will work together to ensure stability in Greater East Asia and build an order of coexistence and mutual prosperity based on morality. The countries of Greater East Asia will respect each other's independence and independence, bear the fruits of mutual aid and harmony, and establish affinity in Greater East Asia. The countries of Greater East Asia will mutually respect their traditions, develop the creativity of each ethnic group, and enhance the culture of Greater East Asia. The countries of Greater East Asia will cooperate closely with each other on a basis of mutual benefit, plan their economic development, and increase the prosperity of Greater East Asia. The countries of Greater East Asia will deepen relations with all countries, eliminate racial discrimination, widely exchange cultures, and contribute to the advancement of the world by willingly opening up their resources.
This is a declaration issued by representatives from various regions of Asia. The ideas common to each statement are the coexistence and co-prosperity of Asian countries, mutual respect, and the elimination of racial discrimination. Was there ever an example of such an agreement between countries in that era? Britain and other countries gained wealth through the slave trade from Africa, which was reflected in the industrial form of producing goods in the Americas using cheap labor and exporting them to Europe. In Manchukuo, the Five Tribes of Harmony was actually sung, and the idea was that all ethnic groups living in Manchuria would build a nation on an equal footing. In other words, Manchukuo advocated the most advanced ideology in the world at the time, and the Greater East Asia Joint Declaration was pioneering in its content, calling for Asian countries to coexist and prosper together and eliminate discrimination. This underlying idea is the spirit of Kazuu Hakko. Hakko Ichiu is the idea of living in peace with the world as one home, centered on His Majesty the Emperor, without discrimination of race, ethnicity, religion, etc. It may seem unreasonable based on current values for countries other than Japan to have the Emperor at the center, but although there are 56 member countries in the British Commonwealth of Nations, the so-called Commonwealth is made up of 56 countries. is the current King of England, Charles III. The original meaning of Hakko Ichiu is found in the latter part, and it can be said that it is also expressed in the Greater East Asia Joint Declaration.
So, where in Asia did Japan invade? In order to cover up all of this, the words Greater East Asia War and Hakko Ichiu were banned. The purpose, of course, was to justify war and colonial policies for the West, and the story was changed to one in which Japan suddenly went crazy and invaded Asian countries.
Japan's struggle against Western colonial policy is a well-known hist
Trump was impressed by former Prime Minister Abe's presentation skills during his visit to Trump Tower - Strong friendship between Japan and the US leaders.
Former Prime Minister Abe visited Trump Tower
South Korea with different objectives as usual
Specific explanation of Japan's contribution
Abe's presentation that impressed Trump
A strong friendship that only businessmen can understand
The impression is that the relationship between former Prime Minister Abe and former President Trump was that of businessmen. It is often thought that businessmen are in a relationship where they take advantage of others based on utilitarianism, but that is not the case in this case. Before Trump won the presidential election and took office as president, former Prime Minister Abe visited Trump Tower.
South Korean Foreign Minister Kang Kyung-wha tried to do the same thing in the next presidential election, but it appeared that South Korea was desperately trying to outdo Japan. Former Prime Minister Abe's objectives are completely different. Abe is said to have personally given the presentation at Trump Tower.
Mr. Trump did not have much knowledge about Japan, viewed the deficit on the U.S. side in Japan-U.S. trade as a problem, and questioned the cost sharing of the Seventh Fleet under the Japan-U.S. Security Treaty. Mr. Abe appealed to Mr. Trump about Japan's position on that question. He explained how much Japan contributes to the American economy, and how Japan contributes to the stability of the Asian region, both in terms of location and cost burden for the Seventh Fleet.
Mr. Trump was a businessman, and Mr. Abe considered himself a salesman for Japan. Mr. Trump must have watched countless business meetings and internal presentations, but he was taken aback by Mr. Abe's proposal, calling it "great." This included the QUAD concept. When Trump later visited Japan, Abe locked him in a separate room and gave the presentation himself again.
There are many politicians and national leaders who have nothing to do with business, but Mr. Trump and Mr. Abe appear to have been formed through mutual understanding between businessmen. Business is about carefully calculating the other party's position, the other party's economy, and the development of both parties, making plans, sharing them, and implementing them. It is only natural that we should respect both parties who have sincerely faced this issue and put it into practice.
Prime Minister Kishida sends off his visit to Yasukuni Shrine - a place beyond Japan's sovereignty.
I will not visit Yasukuni again this year
Current Prime Minister visited Yasukuni Shrine after the war
Where no incumbent national leader can step foot?
Yasukuni Shrine is not a border issue
Violation of national sovereignty, not historical issues
Historical issues cannot be resolved without sovereignty
Prime Minister Kishida refrained from visiting Yasukuni Shrine and paid the tamagushi fee with his own funds. Some people in other countries even think that Yasukuni Shrine is located outside of Japan. This is because the leaders of a country cannot imagine that there are public places within their country that they cannot set foot in.
[Current Prime Minister who visited Yasukuni Shrine after the war]
The 43rd King Higashikuninomiya Toshihiko
The 44th Kijuro Shidehara
45th, 48th-51st Shigeru Yoshida
56th-57th Nobusuke Kishi
58th-60th Hayato Ikeda
61st-63rd Eisaku Sato
64th-65th Kakuei Tanaka
66th Takeo Miki
The 67th Takeo Fukuda
68th-69th Masayoshi Ohira
70th Yoshiyuki Suzuki
71st-73rd Yasuhiro Nakasone
82nd-83rd Ryutaro Hashimoto
87th-89th Junichiro Koizumi
90th and 96th Shinzo Abe
Will President Xi Jinping be able to visit Taiwan? I wonder if it can't be done? People from outside would normally think that if it can't be done in the first place, then it's not China. A sitting president cannot set foot in certain parts of the United States. Everyone would think that this is an area beyond the reach of American sovereignty.
In areas and islands with territorial disputes near borders, there are places where national leaders cannot set foot. In Japan, these include Takeshima, the Senkaku Islands, and the Northern Territories. However, former South Korean President Lee Myung-bak has landed on Takeshima, and former Russian Prime Minister Medvedev has visited Etorofu Island. Their only purpose is to assert national sovereignty.
Let's say that the reason the Japanese prime minister does not visit these areas is to avoid border disputes. But Yasukuni Shrine is located in Tokyo, the capital of Japan.
Before discussing what the Yasukuni issue is, the problem is that it obscures the fact that it is under the sovereignty of the Japanese state. In other words, other countries are restricting Japan's sovereignty by giving orders to the current leader, the prime minister, to visit public facilities in the capital of Japan. Yasukuni Shrine is originally a Japanese religious facility within Japan, and anyone is welcome to visit it.
Whether or not it is a problem because it enshrines a class A war criminal is not for other countries to decide in the first place. This can also be said to be Japan's decision under its sovereignty as a nation. It would be different if Yasukuni Shrine was located in China or South Korea.
Upstream business strategically conducted by Japan.A form of processing trade in which Asian countries, including Korea, assemble and export them.
upstream business used to be a common practice.At that time, supply was scarce in the balance between supply and demand and supply were in short supply.The raw material is the most upstream and the final product is the downstream.Considering distribution, retailers sell to final consumers are the most downstream.If water doesn't flow, you can't do business, but in the age of oversupply, the story will change.The downstream retail stores are more powerful than the upstream manufacturing industry.Japan's 7-Eleven is a symbolic example of this, and OEMs want large companies to build private brands, and manufacturers want 7-Eleven to sell their products.
Japan has developed its upstream business.The strategy is to start with basic research, develop industrial machinery, and manufacture things require Japanese basic technology.Regarding the revision of export conditions for three strategic substances, including hydrogen fluoride, the South Korean government's insistence on supply chain integration means downstream integration, which is intended to put pressure on upstream manufacturing.
Lawmaker Matsukawa of the Liberal Democratic Party affirmed to the world that the global supply chain will not be in trouble.As they say, The world's supply chain never collapsed .
Almost all manufacturing industries in Korea are operated by Japanese industrial machinery and chemicals and parts manufactured in Japan.Currently, They are manufacturing by the basic parts imported from Japan.
The Taiwanese emergency is a Japanese emergency, and it is not clear what the basis is - a basis that assumes various things is necessary.
Taiwan emergency is Japan emergency
Japan confirms security coverage of Senkaku Islands
Taiwan first claims sovereignty over the Senkaku Islands
Sea defenses are extensive
The Taiwan Strait is a sea lane in East Asia
The Chinese government reacted sensitively to former Prime Minister Abe's online participation from Japan at a symposium held in Taiwan, where he said, ``Taiwan's emergency is Japan's emergency.'' Thinking about this matter, Japan and Taiwan do not have a military alliance to defend Taiwan, so it would be difficult to realize it in that sense. The U.S. law regarding Taiwan relations is extremely ambiguous regarding the participation of the U.S. military in the war.
Former Prime Minister Abe was particular about whether the Senkaku Islands were within the scope of the Japan-U.S. Security Treaty, and received assurances from Mr. Trump, and later in a telephone conversation with President Biden, former Prime Minister Suga confirmed that the Senkaku Islands were covered by the Japan-U.S. Security Treaty.
The Taiwanese emergency is a Japanese emergency that seems to have no basis in many legal and treaty terms, but if you think about it, the Senkaku Islands themselves seem to be the key to it.
In the first place, Taiwan was the first country to claim sovereignty over Japan's Senkaku Islands. Three months later, China claimed the claim. Since China calls Taiwan its own territory, what belongs to Taiwan belongs to China. It seems like he made his point in a hurry.
If China were to invade Taiwan, it would logically be considered an invasion of the Senkaku Islands, which are claimed by China and Taiwan. In other words, the conditions for Japan-U.S. security and the activation of the right of collective self-defense are in place. I cannot believe that former Prime Minister Abe would pay baseless lip service.
Another theory is that defense in battle at sea will cover a wide area, and that Japan's remote islands near Taiwan will also be involved in the battle. In this case as well, the Japan-U.S. Security Treaty applies, and if Japan enters the war, the U.S. military may also participate.
The Taiwan Strait is an important sea route for transporting oil and natural materials to Japan. If China were to take possession of this area, Japan would be in a situation where it would have a stranglehold on the sea route through which it supplies resources. Some are claiming that this is an emergency in Japan.
In any case, China has declared in advance that the Chinese military will not turn the waters off northeastern Taiwan, including the Senkaku Islands and other remote islands of Japan, into a combat zone, and that the Taiwan Strait will be maintained as before after the invasion of Taiwan. The question is, what will happen if this happens? Still, there needs to be a basis for invoking the Japan-U.S. Security Treaty.
