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> Because of significant government intervention. Interest rates have been negative for nearly 2 decades. What significant government intervention has there be

by soperj 2y ago

> Because of significant government intervention. Interest rates have been negative for nearly 2 decades. What significant government intervention has there been to keep inflation low? Personally I don't know why they didn't just raise the minimum wage.

alephnerd 2y ago
> Interest rates have been negative for nearly 2 decades Nope. Only since 2015 when the Japanese economy entered a recession and CPI rose to 4%. > What significant government intervention has there been to keep inflation low Negative inflation rates, impacting the ability to borrow further. The expansive welfare system that allows 2% of the poorest Japanese to get direct benefits transfers (it's a great program, but very expensive, so other priorities are lower). Price controls on utilities and some crops like Wheat. > I don't know why they didn't just raise the minimum wage Because Japan has a very extensive set of FTAs, and before 2015 a very high youth unemployment rate (8-12%). If Japan raised the minimum wage, employers would leave for South Korea, Taiwan, China, ASEAN, and India.
- soperj 2y ago
  > Nope. https://www.cnn.com/2024/03/18/business/japan-boj-negative-interest-rate-ended-intl-hnk/index.html https://www.cnn.com/2024/03/18/business/japan-boj-negative-i... First rate hike in 17 years this year. > Negative inflation rates, impacting the ability to borrow further. Government doesn't set the inflation rate. > The expansive welfare system that allows 2% of the poorest Japanese to get direct benefits transfers (it's a great program, but very expensive, so other priorities are lower). Price controls on utilities and some crops like Wheat. Those would lead to higher inflation, not lower.
  - alephnerd 2y ago
    > First rate hike in 17 years this year That does NOT mean interest rates were negative. Negative interest rates were only applied in 2015 [0] > Government doesn't set the inflation rate. Typo. I meant interest rates. [0] - https://fred.stlouisfed.org/series/IRSTCI01JPM156N https://fred.stlouisfed.org/series/IRSTCI01JPM156N
    - soperj 2y ago
      > That does NOT mean interest rates were negative. You're being pedantic. Your graph shows interest rates have been essentially under 0.5 for 30 years. At no point is that a hammer being used to curtail inflation, which was the point.

by soperj 2y ago

alephnerd 2y ago

> Interest rates have been negative for nearly 2 decades Nope. Only since 2015 when the Japanese economy entered a recession and CPI rose to 4%. > What significant government intervention has there been to keep inflation low Negative inflation rates, impacting the ability to borrow further. The expansive welfare system that allows 2% of the poorest Japanese to get direct benefits transfers (it's a great program, but very expensive, so other priorities are lower). Price controls on utilities and some crops like Wheat. > I don't know why they didn't just raise the minimum wage Because Japan has a very extensive set of FTAs, and before 2015 a very high youth unemployment rate (8-12%). If Japan raised the minimum wage, employers would leave for South Korea, Taiwan, China, ASEAN, and India.

soperj 2y ago
> Nope. https://www.cnn.com/2024/03/18/business/japan-boj-negative-interest-rate-ended-intl-hnk/index.html https://www.cnn.com/2024/03/18/business/japan-boj-negative-i... First rate hike in 17 years this year. > Negative inflation rates, impacting the ability to borrow further. Government doesn't set the inflation rate. > The expansive welfare system that allows 2% of the poorest Japanese to get direct benefits transfers (it's a great program, but very expensive, so other priorities are lower). Price controls on utilities and some crops like Wheat. Those would lead to higher inflation, not lower.
- alephnerd 2y ago
  > First rate hike in 17 years this year That does NOT mean interest rates were negative. Negative interest rates were only applied in 2015 [0] > Government doesn't set the inflation rate. Typo. I meant interest rates. [0] - https://fred.stlouisfed.org/series/IRSTCI01JPM156N https://fred.stlouisfed.org/series/IRSTCI01JPM156N
  - soperj 2y ago
    > That does NOT mean interest rates were negative. You're being pedantic. Your graph shows interest rates have been essentially under 0.5 for 30 years. At no point is that a hammer being used to curtail inflation, which was the point.