Why is the yen so high against the US dollar?
Some background:
1. The exchange used to be around 90–100 yen (JPY) per US dollar (USD).
2. Japan is having severe economic problems
3. Japan’s government/Central Bank is rumored to run “dirty floats” to intentionally lower the yen’s value to spur exports
—>This is either not used right now or is ineffective. (not sure which)
4. Japan is having political problems and changes prime ministers often
5. The only reasons I can think of for the rise in the yen are A) trade surplus against the US (not really that big as US consumer spending itself has decreased), or B) people are speculating in Japan (not sure why anyone would do that given Japan’s problems)
Any insight you could give is appreciated.
Articles are good, but it would be better if you give a summary of the article.
Observing members:
0
Composing members:
0
13 Answers
It is the US and China working jointly against the Japanese.
Because things are actually really, really ugly Stateside.
the dollar is under pressure because of the funding of the deficit is by China, for the most part, and also Japan. The dollar/euro rate would also show the dollar weak, but the EU messed up their economy more than we did. Japan;s economy has been stagnant, but it did not tank like the US economy did in ‘07 and ‘08.
Japan has issues.
We have bigger issues.
Response moderated (Off-Topic)
The valuation of the yen over a longer period of time is far more telling.
Japan is a closed market economy, and is highly vulnerable to crude oil price fluctuations. As a closed market economy, their population supports their manufacturing, and they are not dependent on foreign trade, or foreign investment.
The United States is monetarily indebted to China. China and Japan may be collectively teamed together to force the yen to a higher dollar comparison, to the United States dollar.
Except a couple things still puzzle me:
1. Why is the Japanese bank not intervening and if they are, why is it not working?
2. @john65pennington I can’t see why the Japanese would want a stronger yen considering that Japan exports a lot. A higher yen would mean that the dollars received from trade are less valuable.
I remember talking about closed market economies back in the day, and the professor said that the only things Japan needed from outside was crude oil, wood products, and beef. Everything else was self-sustainable. The US historically wanted to import more goods from Japan than Japan wanted to import from the US. They had to create markets for goods they didn’t want in order to balance trade agreements.
@BarnacleBill I think that mixed in there is a need for metals; I seem to recall a U.S.-backed scrap metal embargo during the 1930s in response to Japan’s invasions of China. Its history is dotted with examples of similar scarcity.
Think hard….What is Japans economy based on? electronics? We buy ‘em. what is Americas economy based on?...............yeah…....like I said…. think hard.
Response moderated (Spam)
When the money is not honest, nothing makes sense. No country has honest money now.
@Evilsteve America’s economy is based on counterfeit money.
Answer this question 
This question is in the General Section. Responses must be helpful and on-topic.
Composing members:
0
