Everyday Japan Residents’ Thoughts/Behavior on JPY Crumbling
westonnakamura.substack.com
Lyn Alden on X:
“I'm looking for anecdotes from Japanese readers:
-In your experience, what % of people pay attention to or even care about the yen FX rate?
-Are people annoyed by the price of fuel or similar things that are more directly impacted by the weakening FX rate, or not really?”
My response:
Lyn- I’m based in Tokyo, I’m an active JPY trader / everyday resident ¥ user / 🇯🇵on the ground observer
Can’t really give a figure (% of what “people” ? All 125mn Japanese?) But I get where you’re going & you are very right to be asking- as there’s a huge shift in consciousness underway
Here’s what I’ll say (& this is all pre-Mon “potential” yentervention)-
Everybody here (normal people, not finance) who is even slightly aware of general current events is aware that something major is going on with JPY- & while they may not know the “why” or what a sharply weaker yen means, they know it’s definitely not good. It’s front page news- yes, the exchange rate itself, if not the “weakest in 30-something years”
For individuals/households + businesses who have even the most distant awareness of $yen rate (i.e. those who prob couldn’t quote you within ±10 where USDJPY is trading & just know if the current environment is 円安 “weak yen,” or 円高 “strong yen”)- among those types: 100% are paying FAR more granular attention to both price & fluctuations relative to whatever level of attention they previously paid. Especially business owners- whether you want to or not, either as a beneficiary or victim of JPY↓, there’s no way of avoiding not knowing FX’s daily impact any more than not knowing it’s raining in a storm with no umbrella
For the many who never did care to care → now new entrants of the “care about ¥” club, & many are now taking proactive action to flee/diversify OUT of what was once just “safe” mattress-cash that was never touched, & now being moved for the 1st time due to a collective realization that conservative cash hoarding is actually just being highly concentrated net worth deterioration. Reminiscent of Turks & lira
Can see direct evidence of this with # of NISA account openings & where the flows are moving: ¥ savings →🇺🇸equities (critically overlooked SPX inflow source) - NISA existence in & of itself is not only the 🇯🇵gov literally telling citizens that the social safety net promise will not be there & everyone MUST fend for themselves/own future- it’s also 🇯🇵gov saying that in the long (prob not too long) term, holding >50% assets in JPY cash is higher risk vs investing in stock market over time
I wrote about this👇
westonnakamura.substack.com/p/global-dm-eq…
For energy costs- yeah, everyone is aware & annoyed- or, very concerned of energy bills that are going to go up even more. Nursing homes are checking in room to room every hour to make sure that A/Cs are turned on & people aren’t trying to tough it out. Everyone- be it parents with infants/young kids (all 19 of them that exist in 🇯🇵) or offices or whatever see A/C as an unavoidable cost- each are figuring out where to trim spending elsewhere. Maybe not all are aware of JPY tie-in, but they’re definitely aware that energy bill is skyrocketing
For the rest of general public- we just started Golden Week, 🇯🇵 on holiday this (biggest travel holiday of year)
>23mn travelers this year domestic + abroad. Many domestic travelers are those who wanted to but can’t go abroad due to ¥↓, so they’re very aware
Among the abroad travelers- they woke up Sat AM to see USDJPY > 158 (vs 155 Fri AM). News crews at airports for outgoing flights were interviewing some people who were cancelling their trips on the spot - because who knows how much things like food costs abroad will go up literally by the hour over the course of their trip
So even the vacationers are highly aware of the rate, due to the public headlines & social media etc, it’s now in everyone’s consciousness
No different than if there were some major storm that hit & ruined 🇺🇸thanksgiving- even if you weren’t personally affected, you can’t not know
See chart I made of PM Kishida disapproval ratings vs USDJPY (adjusted ↔︎ weeks: spot FX & survey delays)
It’s not that Kishida is unpopular because people are pissed off about JPY rate itself- but with 🇯🇵inflation, rate of a weak JPY is a barometer of 🇯🇵socioeconomic misery
Everyday Japan Residents’ Thoughts/Behavior on JPY Crumbling
Everyday Japan Residents’ Thoughts/Behavior on JPY Crumbling
Everyday Japan Residents’ Thoughts/Behavior on JPY Crumbling
Lyn Alden on X:
“I'm looking for anecdotes from Japanese readers:
-In your experience, what % of people pay attention to or even care about the yen FX rate?
-Are people annoyed by the price of fuel or similar things that are more directly impacted by the weakening FX rate, or not really?”
My response:
Lyn- I’m based in Tokyo, I’m an active JPY trader / everyday resident ¥ user / 🇯🇵on the ground observer
Can’t really give a figure (% of what “people” ? All 125mn Japanese?) But I get where you’re going & you are very right to be asking- as there’s a huge shift in consciousness underway
Here’s what I’ll say (& this is all pre-Mon “potential” yentervention)-
Everybody here (normal people, not finance) who is even slightly aware of general current events is aware that something major is going on with JPY- & while they may not know the “why” or what a sharply weaker yen means, they know it’s definitely not good. It’s front page news- yes, the exchange rate itself, if not the “weakest in 30-something years”
For individuals/households + businesses who have even the most distant awareness of $yen rate (i.e. those who prob couldn’t quote you within ±10 where USDJPY is trading & just know if the current environment is 円安 “weak yen,” or 円高 “strong yen”)- among those types: 100% are paying FAR more granular attention to both price & fluctuations relative to whatever level of attention they previously paid. Especially business owners- whether you want to or not, either as a beneficiary or victim of JPY↓, there’s no way of avoiding not knowing FX’s daily impact any more than not knowing it’s raining in a storm with no umbrella
For the many who never did care to care → now new entrants of the “care about ¥” club, & many are now taking proactive action to flee/diversify OUT of what was once just “safe” mattress-cash that was never touched, & now being moved for the 1st time due to a collective realization that conservative cash hoarding is actually just being highly concentrated net worth deterioration. Reminiscent of Turks & lira
Can see direct evidence of this with # of NISA account openings & where the flows are moving: ¥ savings →🇺🇸equities (critically overlooked SPX inflow source) - NISA existence in & of itself is not only the 🇯🇵gov literally telling citizens that the social safety net promise will not be there & everyone MUST fend for themselves/own future- it’s also 🇯🇵gov saying that in the long (prob not too long) term, holding >50% assets in JPY cash is higher risk vs investing in stock market over time
I wrote about this👇
westonnakamura.substack.com/p/global-dm-eq…
For energy costs- yeah, everyone is aware & annoyed- or, very concerned of energy bills that are going to go up even more. Nursing homes are checking in room to room every hour to make sure that A/Cs are turned on & people aren’t trying to tough it out. Everyone- be it parents with infants/young kids (all 19 of them that exist in 🇯🇵) or offices or whatever see A/C as an unavoidable cost- each are figuring out where to trim spending elsewhere. Maybe not all are aware of JPY tie-in, but they’re definitely aware that energy bill is skyrocketing
For the rest of general public- we just started Golden Week, 🇯🇵 on holiday this (biggest travel holiday of year)
>23mn travelers this year domestic + abroad. Many domestic travelers are those who wanted to but can’t go abroad due to ¥↓, so they’re very aware
Among the abroad travelers- they woke up Sat AM to see USDJPY > 158 (vs 155 Fri AM). News crews at airports for outgoing flights were interviewing some people who were cancelling their trips on the spot - because who knows how much things like food costs abroad will go up literally by the hour over the course of their trip
So even the vacationers are highly aware of the rate, due to the public headlines & social media etc, it’s now in everyone’s consciousness
No different than if there were some major storm that hit & ruined 🇺🇸thanksgiving- even if you weren’t personally affected, you can’t not know
See chart I made of PM Kishida disapproval ratings vs USDJPY (adjusted ↔︎ weeks: spot FX & survey delays)
It’s not that Kishida is unpopular because people are pissed off about JPY rate itself- but with 🇯🇵inflation, rate of a weak JPY is a barometer of 🇯🇵socioeconomic misery
(follow me on X @acrossthespread)