Welcome to European Tribune. It's gone a bit quiet around here these days, but it's still going.
Yes, certainly at one time the Japanese pursued a discounted FXR policy ... but that was years back.

Of course when the Japanese adopted a full accommodation monetary policy stance in the 90's, that resulted in a lower Yen (indirect) FXR, but that the way floating exchange rates are expected to work when a country has a sluggish economy and adopts a loose monetary policy.

Mind you, Japanese corporations went through a structural transition in the imported/domestic composition of their exports during the 1990's ... a major factor in the sluggish domestic economy in the 1990's ... so I guess someone could argue that they are embedding the neo-mercantalist monetary policy embedded in the Chinese and Southeast Asian into their exports via the imported component of their exports.

I've been accused of being a Marxist, yet while Harpo's my favourite, it's Groucho I'm always quoting. Odd, that.

by BruceMcF (agila61 at netscape dot net) on Thu May 29th, 2008 at 06:56:00 PM EST
[ Parent ]
But the Japanese are much more flexible than their regional competitors for the simple reason that they own and co-own manufacturing facilities within many of their largest trading partners - the U.S. in particular. Taiwan has some similar endeavors, but nothing on the scale of the Japanese penetration.

Upshot is that they can - and do, as I can state from personal experience - make manufacturing/import/export decisions based on their analysis of the mid-term, relative financial trends between their domestic economies and those of their 'clients'.

paul spencer

by paul spencer (paulgspencer@gmail.com) on Fri May 30th, 2008 at 02:23:39 AM EST
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