Tuesday, April 26, 2005

Begging for Dummies, Lesson 2.


The BBC carries this news for us all:the Japanese are worried about their great success in keeping the currency deliberately low, like the Chinese, and selling great cars that aren't rank gas guzzlers.

Toyota boss fears US trade fury

Japanese designs are proving popular in the US

Japan's car makers should consider giving their US rivals a breathing space to avoid the risk of a political backlash, the boss of Toyota has said.
Japanese car makers have taken nearly one third of the US market. Last week, General Motors posted a quarterly loss of $1.1bn, and Ford's profits fell.

By contrast, Nissan had record profits, and Honda's net profit rose 27%.

"We need to give time for some American companies to take a breath," said Toyota Motor chairman Hiroshi Okuda.

Mr Okuda, who is chairman of the Japanese employers' group Keidanran, said he was "concerned" about the situation at General Motors, the world's biggest car maker.

Ain't that nice of him? He is going to "help" us. Will he demand his government stop supporting the dollar? Heh. Stop buying American debt? Will the cow jump over the moon?

Once again, Japanese cars are taking off in America because they don't guzzle gas. This was easily foreseen and easily dealt with which is why Congress and the UAW and corporate America rose up in fury when a bill raising CAFE standards went to Congress. The old Chinese curse, "may your wishes come true" comes to mind.

The fact is, we can't yell at Japan to stop because we are beggars in Tokyo. We trot behind the Japanese begging to wipe their windshields for them. We are willing to hand over our military to them if they only give us more money. They are happy to do this. It is a great bargain. I note that the BBC article doesn't mention how Japan twists the financial markets to keep their own currency artificially low so they get a huge trade advantage over America. For some ODD reason the only country mentioned doing this is China. This is ridiculous. This is why so many economic commentators can't figure out the obvious. If the media doesn't ever mention something it becomes invisible. This is why this blog obsesses about these things. The dog that doesn't bark as Sherlock remarked is the key to solving mysteries.

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