Japanese Company Expectations:

 https://mainichi.jp/english/articles/20210103/p2g/00m/0bu/021000c 

Article:

TOKYO (Kyodo) -- Some 72 percent of major Japanese companies expect the economy to expand at a moderate pace in 2021 amid hopes that the fallout from the coronavirus pandemic will subside, a Kyodo News survey showed Saturday.

Despite such a positive outlook on the world's third-largest economy, more than a quarter of the 109 firms in the survey, or 29 percent, said they are not sure when their sales will return to pre-pandemic levels, and 13 percent expect any recovery to materialize in 2023 or later, indicating that corporate Japan remains cautious about their businesses.

A sense of caution prevailed toward the end of 2020 as Japan was hit by resurging coronavirus cases. It came as the Japanese economy was gradually rebounding from its worst contraction in the April-June quarter when Japan was placed under a state of emergency over the novel coronavirus.

Ideas:

When I write I am not sure exactly what I want to say. But once I start writing then the ideas begin to come. The ideas may not be correct, and as such as such they are just ideas, nothing scientific or maybe not even related to academic theory, just ideas.

Companies are taking a very conservative approach in saying a moderate recovery. They don't want to take a chance and say anything more less they upset stockholders if they are a publicly traded company. Better to take a safe a approach for 2021.

Only 29 percent are not sure they if can return to pre-pandemic levels. The figure could actually be higher but again, some companies want to show some kind of moderate confidence but not too much confidence.

The same might be said for capital spending or investments by companies. They most likely will take a wait and see approach unless they really need to equipment, factories and such.

Article:

Prime Minister Yoshihide Suga had sought to balance supporting the economy and tackling the health crisis but his handling of the pandemic has been called into question.

The survey found 72 percent see moderate growth, followed by 17 percent that expect economic conditions to remain unchanged. Some 2 percent said the economy will expand, while another 2 percent project a moderate contraction, according to the survey.

With multiple answers allowed, 64 percent of the firms expecting economic growth in the year ahead said the impact of the pandemic will stabilize and 47 percent cited recovering private consumption. Some 32 percent picked a recovery in overseas economies and 14 percent pinned hopes on the effects of economic stimulus by the government.

Ideas:

I think its seem logical to try and help the economy and try manage the virus situation. Its a catch 22 situation, meaning just doing one or the other will cause problems for whatever one is being neglected, or so it seems.

But no one of course expected a third wave. And as such it seems that trying to fix the virus situation might have been the best choice, but also of course, neglecting the economy, might have made the economy even worse. 

Again the survey results appear to be somewhat modest but the same time trying to show maybe investors we think it might grow somewhat in 2021.

The ideas of recovering private spending or consumption sounds good. But if the virus situation continues one, just what kind of recovery and how much can be expected. 

At at the same time, consumers don't want to just sit and not spend, in many situations. So there might be a time when there is some kind of significant consumer spending surge. As they are tired of just waiting for the virus situation to change. It might be online spending or shopping only but there could be a real and significant surge if there is a hint of daylight at the end of the virus tunnel and or consumers are just tired of it want to do something and just start hitting all the online sales.

Article:

Economists say uncertainty over the economic outlook will persist with vaccines and treatment drugs for COVID-19 seen critical, after virus outbreaks led to lockdowns in some countries and depressed economic activity and travel. The Japanese government projects a 4.0 percent expansion in real gross domestic product in fiscal 2021 from a year ago.

The Kyodo News survey showed an increased shift toward digitalization to cope with the spread of the virus as all companies introduced teleworking and 99 percent said they promoted online meetings.

Digitalization is one of the priority areas for Suga, who has seen his support ratings plunge in recent weeks after his honeymoon period ended.

Ideas:

There is still a lot of uncertainty and even as some countries begin with the vaccines, there still might be the virus situation.

But at some point there will be the need to try and normalize regular things as much as possible.

But at the same time, the idea of teleworking might be here to stay. How much exactly is yet to be seen. Workers might not want to go back to the office completely. 

Welcome to the real 21st century where the idea of having to go an office from 9 to 6/7/8 might be a thing of the past for some companies.

And some companies might see it as a competitive advantage to promote that they are teleworker friendly especially for younger workers or working mothers.

The Japanese government is of course trying to be optimistic with a 4.0 percent increase in GDP in 2021. But that is not really much compared to how much the economy contracted in 2020.

Article:

Among the prime minister's policy items, 29 percent said they support the creation of a digital agency that will be tasked with digitalizing administrative work, followed by 28 percent that are in favor of promoting regulatory reforms.

Some 20 percent backed the government's efforts to fight global warming, while only 1 percent were in support of the administration's move to lower mobile phone fees that it sees as higher than in other countries. Major mobile carriers have yielded to government pressure and announced cheaper options in what is shaping up to be a price war.

Suga has promised to expand support for often costly fertility treatment as Japan faces a declining birth rate. About a third, or 33 percent, do not have a support system for employees who receive fertility treatment, while 64 percent said they already have one in place or are considering creating it, according the survey.

Ideas:

The idea of regulatory reforms, when it comes to business might be a good thing, as long as everyone plays fair. Many time business regulations are setup to try and level the playing field but in fact most times they actually reduce business activities. So if the regulatory reforms actually help improve business activities then its a good thing. 

Its interesting that only 1 percent support a reduction in mobile phone fees when the fees are higher than most countries. 

A price war might not be a bad idea if it helps consumers and at the same time doesn't cause some companies to leave the market. 

Not all price wars are good as many times the largest companies always win and the smaller companies always lose out. But if the price war can help reduce prices for consumers and not hurt the smaller companies then it could be a good thing. 

Article:

Ahead of the launch of an administration by U.S President-elect Joe Biden in late January, 35 percent expect he will promote free trade and 18 percent said the Democrat would seek to accelerate economic growth.

Kyodo News conducted the survey between mid-November and early December, targeting major companies in each sector. The 109 firms include Toyota Motor Corp., Sony Corp., Seven & i Holdings Co. and ANA Holdings Inc.

Ideas:

Again companies are going to take a wait and see approach on 2021 but at the same time try act like the think there will be modest economic growth. They don't want to sound to optimistic as not to get the hopes of investors to high. 

With free trade there are always positives and negatives depending on where you are at. But no doubt Japan is well positioned to with China, the US, and the new trade pact that was recently signed. And with Japan and the UK agreeing on a pact Japan trade looks promising for the future.

Have a nice day and be safe!