Financial Observation: Where Does Andouble Economics Go?

The "three arrows" of Andouble economics have their own drawbacks. The deterioration of today's economic situation is the result of the failure of Andouble's economic policy. The first arrow "bold financial policy" is the main factor leading to the dramatic decline of personal consumption. Too much capital flows into the market has led to a sharp fall in the yen exchange rate. The price of imported food and fuel imports has risen sharply. However, the growth rate of household income is far behind the increase in consumption tax and price, resulting in a decline in actual purchasing power, and consumers have to tighten their purse strings, causing a sharp decline in personal consumption expenditure.

The second arrow "positive fiscal policy" has not played a proper role in boosting the economy. Although Andouble's cabinet supplemented the supplementary budget of 5 trillion and 500 billion yen to stimulate the economy, but because of the shortage of labor force in construction industry and the soaring price of construction materials, it did not lead to the recovery of related industries. The third arrows, known as the "economic growth strategy", have stressed the need to implement structural reforms without a restricted zone. By setting up special zones to attract funds, talents and enterprises to enliven the local economy, they did not come up with specific implementation strategies. They are totally large and empty, and have not had a substantial positive impact on the real economy so far.

　　 Dragging the global recovery process

Japan is the third largest economy in the world, and the recession will have an important impact on the countries closely related to trade and economic relations, thereby dragging the global economic recovery process. First, Japan's financial policy and the deterioration of the economic situation accelerated the decline in the yen exchange rate. The devaluation of Japanese yen has led to a decline in competitiveness of other countries' exports to Japan, and has a direct impact on commodity exports to Japan.

The recent devaluation of the Japanese yen has aroused strong dissatisfaction among the relevant parties in South Korea. It is believed that the depreciation of the Japanese yen has had a negative impact on the export enterprises in South Korea, and that it will take effective measures to maintain market stability when necessary. International financial experts worry that the excessive depreciation of the yen will catalyze Asian countries to compete to lower the value of the currency and trigger a new currency war.

On the other hand, Japan's economic recession has led to a decline in domestic demand, affecting the number of imported goods from Japan, and thus affecting the economic activities of trading partners. Data show that if the import of energy resources such as oil is eliminated, Japan's imports in other fields will be reduced to varying degrees. People worry that once the Japanese economy falls into a long-term recession, it will have a negative impact on the world economy. It is hoped that the Japanese government can take effective measures to push the economy into a normal recovery track.

　 The end of Andouble economics?

Andouble economics has been practising for two years, but not only did the Tokyo stock market get a good rise in the Nikkei stock index, the employment situation has improved, but also the profits of export led enterprises have increased. Bold financial policies Currency devaluation The price increases, the burden of ordinary people increased, and the quality of life declined.

"Positive. fiscal policy "Japan's national debt has increased further, leaving behind huge debt burden for future generations. In less than two years after Andouble came to power, the government debt increased from 997 trillion yen to 1038 trillion yen at the end of September.

Andouble economics has widened the gap between the rich and the poor, reduced the middle class, and it is also reasonable for the personal consumption that accounts for more than 60% of GDP. Andouble economics has entered a blind alley.

The deterioration of the economic situation forced Andouble to postpone the implementation of the established plan to increase the consumption tax from 8% to 10%. Postponing tax increases will help expand personal consumption and give the Japanese economy a chance to breathe, but this will surely endanger the Japanese government's commitment to slash its fiscal deficit. It will not be able to achieve the goal of restoring the fiscal deficit to GDP in fiscal year 2015 in fiscal year 2010, and achieving the goal of fiscal surplus in fiscal 2020.

Japan economic group Hara Jo, the president of the Federation, issued a statement on 18 th, demanding that the Japanese government formulate economic stimulus measures to push the economy into a virtuous circle and clearly plan a new way to improve the financial situation.

Japanese scholars believe that Andouble economics has reached the limit. In addition to constantly printing money to guide inflation and dilute government debt, it is difficult to make greater achievements. Japan's goal of rebuilding finance has been far from being expected.