Isetan Mitsukoshi CEO says won't cut prices even with return of deflationary mindset

Basically, say thank you to Abenomics.

Ha! Hiroshi Ohnishi is smart enough to know the end is near, but too scared to do or say anything about it. I would have liked to hear him say "Mr. Ohnishi was quoted saying 'the central banker paradigm is just not working. Shinzo Abe needs to fire off that third arrow and reform the tax laws reducing the burden on the average middle class citizen, drastically reduce government spending for at least 15 years and start attacking the graft in business and politics'"

On a side note, I was kind of shocked when I just received a call from the director of Costco Japan while typing this. I wrote an e-mail to the main office in the US a week ago about one of their stores reducing the syrup in their pepsi. It's a newer store and it started tasting more like soda water than pepsi. The guy said he's going to test it and get back to me next week. This is the kind of thinking Abe needs to do to save this country to stop the swirling of the toilet.

I don't expect prices to fall; I expect hyper inflation once the only customer for negative interest government bonds is the BOJ. I only buy what I need and save/invest the rest. Consumption cannot increase unless wages increase, it's a simple as that.

This is an example of how businesses in Japan collude to keep prices high. Isetan and Mitsukoshi are the two big high-end retailers here, the third being Takashimaya, and you can bet that these two men have lunch and play golf together. They also do what they can to keep their prices the same, so as not to compete against each other.

What is not directly mentioned in the article is that as the yen gets stronger, the goods these stores sell, most of which is imported, becomes cheaper to them, which in turn should make these goods cheaper to consumers. But of course there is no change at all in the shelf prices of these goods. These stores have long said that lowing prices when the yen strengthens is "bad for consumers", and is "disruptive." What it really means is that these stores engage non-competitive business practices which would put their executives in jail if they did these things in America or Europe.

In Japan there is a terrible phobia against competition of any kind, and competition is what gives us the best products at the best prices. Japan still refuses as much as possible to let foreign competitors enter the Japanese domestic market. And even in the absence of foreign competition, Japanese companies refuse to compete with each other.

Those that cannot compete cannot adapt, and are doomed.

Very good comment from Fizzbit. Anyway, Abe's band don't care since they don't have kids for most of them and are high salary/bonus garanteed. -8.3%, damned that is a lot ! The main reason is the yen increase against all other currencies. Playing with your currency is a "childish" way to get to temporary results.