Japan Govt. Economic View: IN the Process of Re-formatting each blog for 2020, 2021, and 2022.

 https://mainichi.jp/english/articles/20201222/p2g/00m/0bu/092000c

Ideas:

Consumer spending is always a concern for the Japanese government. But of course its even more of a concern now related to the virus situation as some consumers tend not to go out as much and or spend as much as they are concerned about jobs, the future, and the spread of the virus. 

But of course the government always try to say something positive, the same anywhere, but the phrase " but is showing movements of picking up" is normal government language to try and signal to whomever, that its not all that bad, things are showing some improvement.

But then it becomes more clear which is quite true in any complex economy, there are sectors that might be doing better than other sectors. 

But this is true even in a normal economy. Even in a normal pre-pandemic economy, there are positives and negatives, there are some sectors that are always doing better than other sectors and there are always some businesses doing better than other businesses.

The "Go To Travel." maybe at the time, was a sincere attempt to spur economic growth and get some kind of domestic travel moving again. But maybe no one, anywhere in the world, including Japan, expected a third wave as severe as it is now.

Consumer spending is always a challenge for Japan, even though it makes up maybe 50 percent of GDP. 

Its interesting that consumer spending on cars during the pandemic is remaining firm, as you would think, as cars are a big spending investment that consumers would be more cautious about"big spending" items such as cars, appliances, or homes.

But at the same time "socio-economic" activities of course are the biggest losers or challenges in the pandemic.  Services, travel, retail, restaurants might be the biggest losers.

However, as anywhere companies learn to innovate, as best they can, such as new delivery systems, new online shopping portals and choices for consumers.

Those who can learn to innovate in the pandemic. But there are thousands of businesses that maybe don't have the resources needed to innovate.

And at the same, maybe no amount of innovation can help some businesses. How can travel agencies really innovate if there is no consumer demand or very little?

This is where governments should step and help those businesses with a much help as they can, and not just a one time offer. There needs to be multiple efforts to keep small and medium companies going. 

This is not the time to say "let the market decide" who survives and who wins. This is a challenging time that is not related to normal market or business actions. 

Exports only make up about 20-25 percent of the Japanese economy. Even though that doesn't seem like a lot it is a large part of the world's third largest economy.

Again the question remains with the pandemic as it is, why are cars selling as good as they are?

Not to say the pandemic doesn't affect everyone, which it does, but maybe there is a segment of the population, anywhere, is not as concerned about their jobs or future, and as such feel free to spend on a new car while there are of course millions everywhere who are worried about the future and jobs etc.

It just shows how an economy is very complex. As such you have those who might not be worried about jobs and future in the pandemic and you have who are really affected by the pandemic and don't even consider a new car at this time or the near future.

The idea of solid demand for semiconductor related products is not surprising due to the increased work from home and students taking online classes, so the maybe the need for new products such as PC's notebook computers, tablets etc.

The global economy. maybe in the early fall, showed signs of picking up but now the third wave probably will cause much of the global economy, with the exception of China, to slow down again in the next couple of months.

But again we have add a exception. The global economy, like any domestic economy is very complex with many global sectors.

We live in a global economy, that is very integrated, with some areas, such as car production and sales going somewhat good, and then the global airline industry, which of course is at an all time low at this moment.

So again we need to be careful and not paint a picture of complete gloom and doom as in the pre-pandemic period, there are still positives and negatives, but of course there are more negatives at the moment. 

Its important to see just what is being said here. The government is not saying corporate profits are on the rise but that they are not decreasing as much as before. 

The Tankan  business sentiment, feeling, survey just indicates a point in time about how companies might be feeling. It doesn't actually mean they are going to do anything different than what they are doing now.

Companies, most likely, are still taking a "wait and see" approach or a very cautious approach until the see consumer demand or business demand begin to improve enough that they feel good enough on increasing production, investments, and or an increase in services again.

Only the most needed capital investments, mostly likely are going to take place at this time.

But again, an economy is very complex. There might be some sectors and businesses are are doing reasonably good and feel is OK to spend in capital investments while some are going to take a wait and see approach.

And some use this strategy. When the economy is down and or business is not as good, is actually the best time for capital spending or even re-tooling their business for when the economy and business conditions get back to normal.

Have a nice day and be safe!