business

Japan downgrades growth estimate for July-Sept to 1.3%

7 Comments

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7 Comments
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Wasn't unexpected, probably i was the only one who had predicted downward revision.

0 ( +1 / -1 )

Though the revised figures do not reflect any actual change in Japan’s sluggish economic reality, since they boost the overall GDP figure they are a “substantial windfall” from a political point of view

No. Only fools would believe the number fiddling has any political benefit, and most people aren't fools.

The higher number pushes Japan closer toward Abe’s goal of attaining a 600 trillion yen ($5.3 trillion) nominal GDP.

He should be asked to revise his 600 trillion yen target to 630 trillion, to ensure apples for apples comparison. Opposition parties should mock him furiously should he have the nerve to claim he's made progress because of this.

It also improves Japan’s gross debt-to-GDP ratio

True, but again it's number fiddling, and the gross debt is still in excess of one quadrillion yen, and the central bank monetizing it doesn't make anyone feel better at all.

0 ( +3 / -3 )

and most people aren't fools.

I wish this were true. But if such were the case, the likes of Abe would not be prime minister. The very sad fact is that the vast majority of people are fools, in one way or another.

What would happen to the numbers above if state spending were subtracted? The most interesting thing about GDP numbers is that they include government spending. This would make sense if the money spent created a positive return, as it normally does when a business spends money. But government spending results a universally negative return, meaning that for every yen they spend, we get less than one yen in benefits, infrastructure, or other services. Worse yet, much of this spending is done with money the government doesn't have, and must either be borrowed at interest, or printed by the central ban, either of which negate whatever positive influence the spending might have had.

If you look carefully, you might notice that the amount of "growth" created this year roughly coincides with the increased government spending budget. This is not the kind of "growth" we need.

5 ( +6 / -1 )

Economic growth is not easy to achieve when your population is aging and shrinking. This result whilst not fabulous is not bad.

-1 ( +2 / -3 )

Tbh I'm surprised it's as high as that.

5 ( +5 / -0 )

Like it or not. I doubt it. It's manipulation. I don't see any growth. If Japanese companies can manipulate their earnings why can't JG?

0 ( +0 / -0 )

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