The U.S. economy is undergoing changes once again!
Japan is really panicking now, starting to frequently show goodwill to China, so what is the real purpose behind it?
Right after the trilateral meeting of China, Japan, and South Korea, Japan seized the opportunity to strike while the iron is hot, which means that the Vice Speaker of the House of Representatives is coming to China soon.
This is the first time in 6 years!
So what is the purpose of his visit this time?
According to the official statement from Japan, it is for the economic cooperation between the two countries.
However, we must be aware that over the past few years, Japan has been fanning the flames in the economic tug-of-war between China and the U.S., even behind the scenes, it has been hyping up the so-called "China threat theory."
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So, as the vanguard of the United States, has Japan really had a change of heart?
Let me state my conclusion first, I would rather believe in ghosts than believe in Japan's broken promises.
The real purpose is not so simple.
Let's continue to look further.
Just last month, with the strong U.S. dollar index, the yen depreciated against the dollar to a new height, so Japan used 9.8 trillion yen to intervene in the foreign exchange market.
But in less than a month, the yen depreciated to a historical low again.
Immediately after, the Japanese Finance Minister said that there would be no limit to the use of funds to save the foreign exchange market!
The implication is that Japan can sell a large amount of U.S. bonds to save the foreign exchange market.
On the other hand, Yellen warned that intervening in the foreign exchange market should not become a routine tool.
It can be said that Japan is still subject to the United States in intervening in the foreign exchange market.
In other words, Japan really dares not to sell a large amount of U.S. bonds to save the foreign exchange market, Japan's attitude is nothing more than wanting the United States to cut interest rates as soon as possible.
In addition, if Japan wants to save the foreign exchange market by raising interest rates on the yen, this deviates from the essence of Abenomics that Japan has adhered to for decades, Japan may once again perform the Plaza Accord, and fall into the trap of the United States and cannot extricate itself.
This is enough to show that in response to the current state of the U.S. economy, the above two approaches by Japan are not feasible.
However, to make matters worse, the U.S. economy is now in turmoil.
Looking at the Trump incident, this has added too much uncertainty to the Federal Reserve, which has just breathed a sigh of relief and is preparing to plan for interest rate cuts.
So we can now imagine that if the United States follows the old route of Trump, raising tariffs, expelling immigrants, and deficit financing, then the U.S. dollar interest rate will be even stronger, and those countries that rely on the U.S. dollar economy will have a harder time, and then what new height will the yen depreciate to?
Can't Japan see it?
Let's dig deeper, the core point of the continuous depreciation of the yen is not here.
The root cause is that Japan's economy is continuously declining.
Let's look at a set of data, in the first quarter of this year, Japan's GDP annualized quarter-on-quarter decreased by 2.9%, exceeding market expectations.
If calculated by purchasing power parity, Japan's per capita GDP has approached the last place among G7 countries, and is on the verge of leaving the ranks of developed countries.
In addition, Japan's economic total has also declined to the fourth place in the world.
According to the International Monetary Fund's forecast, India will surpass Japan in 2025!
It can be said that Japan's economic development over the years has been terrible.
In other words, if the Japanese economy does not rise, whether it is Japan selling U.S. bonds or raising interest rates on the yen, even if the U.S. dollar cuts interest rates, it cannot solve the core problem.
Therefore, in order to save the Japanese economy from the deep water and fire, Japan knows that it is definitely unreliable to rely on the United States now, but it dares not to offend the United States, so what to do?
In other words, the decline of the Japanese economy is related to Japan's aging population and tight labor market, but there is an important point, that is, Japan's foreign trade exports to China are continuously decreasing.
Let's look at a set of data again: In the fiscal year of 2023, Japan's trade deficit with China was 5.9 trillion yen, and the export volume of food to China decreased by 33.6% year-on-year.
The reason is of course inseparable from the economic and trade relations between China and Japan, and also because of Japan's nuclear pollution water discharge into the sea, our country has completely suspended the import of Japanese aquatic products.
So, Japan wants to solve the problem fundamentally, that is to restore the economic and trade relations between China and Japan, this is the key.
So you see, after the trilateral meeting of China, Japan, and South Korea, Japan said that even if the economic tug-of-war between China and the United States is fierce, Japan cannot do without the Chinese market.
Then it chooses a cautious attitude towards the policy of the United States and Western countries imposing high tariffs on Chinese cars.
Now it is in a hurry to come to China.
There is only one purpose, that is to ask China to import more Japanese goods, especially Japanese aquatic products.
This means that Japan only starts to think about its own way out when the U.S. economy is in turmoil, and the ultimate goal is to let China help Japan pay for the mistakes made by Japan's nuclear pollution water discharge into the sea, so as to let itself get through the difficulties smoothly.
So, Japan's change of heart is all fake, because Japan is too dependent on the U.S. economy, as long as the U.S. economy gets better, his face-turning speed is faster than turning the pages of a book.