Japan Contraction: Updated July 4, 2024.

 

Japan Jan.-March economic contraction revised to annualized real 2.9%

Article Source:  https://mainichi.jp/english/articles/20240701/p2g/00m/0bu/006000c

Ideas:

Economic data is always being reviewed and if needed revised upwardly or downward, depending on new information.

An annualized estimation is if the economy did the same thing for at least a year, but an economy never is the same from month to month or eve quarter to quarter.

Its not easy to see what is true or not true, but sometimes, whether intentional or a mistake, the numbers can look more positive after a review or more data is found. Such as a 0.1 percent growth, might not sound like much, but it gives the Japanese government more breathing room to talk about how the Japanese economy didn't contract for three consecutive quarters.

The Japanese economy always seems to be fragile related to economic growth. But at the same time, its a very stable economy, and there no real sudden shocks related to the Japanese economy.

Consumer spending in Japan is never where is should be as inflation and maybe the overall Japanese character is not to spend but save most of the time.

The Japanese car industry, which is a major economic driver in for the Japanese economy, has had some challenges the past few months with the quality testing situation and fake test results.

The Japan GDP is never where is should be, like consumer spending as it never seems to get past the 1 percent growth, if even that.

Again, as new information or data is found, many times there are going to be upward or downward changes in the initial information. That doesn't mean there is any negative or manipulation of data, as all governments revise their data depending on what new data they find later.

Public investments is related to government investments, and sometimes the Japanese government does a lot of investments depending on the political situation and the mood of the public. Public investments, for the most part increases the government debt.

Private residential investments might have been lessoned due to higher raw material costs and or an increase in land prices and or even due to the Bank of Japan increasing the key interest rate recently.

Private consumption or consumer spending is always the main challenge for the Japanese economy, as consumer spending is never where it should be, due to the Japanese consumer mostly being savers and not spenders.

But a decrease of 0.7 percent is really not that much of a decrease as consumer spending basically stayed the same from the pervious quarter.

The Japanese economy and the US economy are not really interconnected that much as the US economy seems to be doing very good while the Japanese economy is still stuck in its deflation situation while its stable its not growing that much.

Nominal GDP is not the real economy as real wages determine what is really happening in the Japanese economy.

Real GDP is more important than nominal GDP as the real GDP affects Japanese households the most and not nominal GDP.

The Japanese economy seems to always be falling into a technical recession, but again, the Japanese economy is a very stable economy, and as the 3rd or 4th largest economy in the world continues to move forward, but a a very slow pace.

The Japanese economy, is something of a mystery sometimes, as it just keeps going but at the same time is always contracting but still a very stable economy, and there are never any real major shocks with the Japanese economy, overall.

Have a nice day and be safe!