Head of mayors' group seek review of cash handout program

Thursday 08th January, 05:25 AM JST

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8 Comments

NuckinFutz at 07:37 AM JST - 8th January

Well I'm glad someone is looking "longterm" at the economy! Give me a free meal today and I'll have a full stomach! Give me a good job and I'll feed myself for a lifetime!
borscht at 08:31 AM JST - 8th January

Aso apparently thinks once we get our 2 trillion, we'll all run out and spend all of it on... something other than rent or food. I think he thinks we'll put a downpayment on a 2 million-yen car. I wouldn't be surprised if 50% or more is saved rather than spent here in Japan (I'd be interested to find out how much was spent in the US when the Bush handed out free money.)
saborichan at 09:25 AM JST - 8th January

With layoffs being handed out like tissues at the moment, plenty of people are probably feeling under the axe. My job is secure enough that it won't disappear anytime soon, but I doubt the average manufacturing worker is going to rush out and buy new (locally produced) goods...
whitepocky at 12:34 PM JST - 8th January

I wouldn't be surprised if 50% or more is saved rather than spent here in Japan.

Isn't that the idea behind these decisions. If, as most people probably will, bank it, the government has a larger kitty from which to dip their hands into. It seems like this scheme is just transferring large amounts of money from one area to another without actually acheiving anything. Except a few brownie points for Aso and his cronies that is!!
saborichan at 12:44 PM JST - 8th January

No, pocky, that's not the idea at all.

If someone spends $10, then that $10 is moved into someone else's hands and spent again and again. You buy the bento which pays the wages of the staff who buy their own bento whose company buys daikon from the farmer down the road....It's this trickle-on effect that keeps businesses in the black. Moreover, if everyone saves, there is a larger pool of money to borrow from the banks for investment, etc. This means the interest rates given on savings will fall, whilst the price of borrowing also tumbles.

Facilitating more loaning in the wake of the financial crash is a big issue for economies looking to get their big manufacturers working again. But the banks are hurting from unrecoverable loans in the housing industry and other sectors, so they're tightening the purse strings and making it harder to get a loan, even if the interest rate on what you borrow isn't bad. This is why governments around the world reacted to the financial crisis by cutting interest rates.

Saving is considered a withdrawl from the economic cycle. The money's not disappearing, but it's not changing hands either. It gets reinjected by the government in other ways, true, but that's not the same as live market action.
HeathenCabin at 05:30 PM JST - 8th January

Saving what people think is valuable is human nature. Saving and loans do not matter so long as it is dictated by a free market without government intervention/control, yet we/the market have central banks(central planning) controlling everything/interest rates. Private loans are acceptable, the market setting interest rates is acceptable, but guess what that would mean all of these companies that are not sound/profitable/rely on loans and have loans that are unprofitable would go bankrupt. So in the end people who save get nothing while being robbed of potential rewards(high interest rates).

The whole financial crash was due to expanding credit, credit that was easy to get. Unsound practices and now its time to pay the piper. Of course the government does not actually have any money, or any value. All it does is steal from those that produce the wealth and redirect it to unsound businesses/jobs/its own pocket. It also destroys wealth that would have been created in a free market.

In short: Savings is normal human nature! It should be embraced.
Simon_Foston at 10:45 PM JST - 8th January

"If the 2 trillion yen scheme is a measure to stimulate consumption, rather than one to support people’s livelihoods, it is necessary to reconsider it."

JPY12,000 per person isn't enough money to achieve either of those goals.
medievaltimes at 11:44 PM JST - 8th January

Why can't the Japanese politicians focus on real issues...like how to communicate with hostile UFO's?