Japan companies on shopping spree with strong yen (AP)

TOKYO – Rakuten is not just the top shopping website in Japan. These days the company is doing some serious shopping of its own as it turns the strong yen — usually seen as a huge negative for Japanese companies — into a plus.

The online shopping mall operator has bought several overseas businesses in the last year and is not the only Japanese company on an acquisition spree. Businesses from pharmaceutical companies to toy makers have been emboldened by the increased purchasing power that the rising yen gives them.

A strong yen has long been characterized as potentially fatal for Japan Inc. by making the country's cars, consumer electronics and other goods more expensive abroad, eating into the earnings of giant exporters like Toyota Motor Corp., Sony Corp. and Nintendo Co.

But for a service company such as Rakuten Inc., the yen at post World War II highs is a boon it hopes will help it catch up to giants in the global e-commerce hierarchy such Amazon and eBay. The yen is up nearly 8 percent against the U.S. dollar over the past year.

"I like it," Rakuten Chief Executive Hiroshi Mikitani said with a grin when asked about the yen's gains. "We can buy more companies."

Mikitani also thinks Japan's traditional export-focused manufacturers should be taking advantage of the yen's rise by buying rivals in emerging markets. But he said some may be reticent as they lack the management expertise to know what to buy or how to make it work.

"They should think about that, and utilize the strength of the currency as a weapon," Mikitani told reporters. "I think we should favor the stronger yen."

Embracing a strong yen is an uncommon attitude among Japanese CEOs, and officials. Rakuten is different in other ways too. Nearly three quarters of the hires joining the company this month were foreigners and Mikitani's pep talk at a welcoming ceremony this week was in English, the standard language at Rakuten — both rarities for usually insular Japanese companies.

The jump in overseas acquisitions by Japanese companies this year has come even though the global economy faces extremely uncertain times and Japan's own economy has reeled from the March 11 earthquake and tsunami disasters.

Data compiled by Tokyo-based Recof Corp., which advises on acquisitions, found overseas takeovers and acquisitions by Japanese companies gained by 30 percent in number of deals in the first eight months of this year.

The jump was most pronounced in Asia, where the number of deals increased 50 percent year-on-year to 143, a record for the region, although the purchase prices were bigger for deals in the U.S., according to Recof.

Data from Dealogic shows that the value of overseas takeovers and acquisitions by Japanese companies in January through August more than doubled from a year earlier to $46.7 billion.

Among the biggest Japanese takeovers announced in recent months was Takeda Pharmaceutical Co.'s deal to buy Switzerland's Nycomed for $13.6 billion, giving Japan's biggest drugmaker coveted access to emerging markets.

Another was Tomy Corp.'s purchase of RC2, the U.S. maker of Chuggington and Thomas & Friends toys in an all-cash deal valued at about $640 million.

Online securities company Monex Group Inc. bought TradeStation Group, based in Florida, in a deal valued at up to $411 million. Brewers such as Kirin and Asahi have also been busy acquirers.

The yen's gains can also tip the scales in favor of manufacturing investments overseas.

Last month, Honda Motor Co. announced a $50 million investment to boost transmission production in the U.S., bringing the automaker's capital investment in Ohio to more than $400 million for this year.

Matt McCollister, a vice president at central Ohio's economic development panel, Columbus2020, said the strong yen came up often in meetings with Japanese executives as a solid incentive for overseas investment. He visited Japan recently to woo more investment to the state.

"I don't know that it's the primary catalyst, but it can definitely be a tipping point for a project, especially if there's one that has been under consideration," he said. "When you start to apply the currency differential, it may make more financial sense than it did a year ago."

Still, there is no doubt that the yen's unrelenting strength is the source of plenty of woe for many of the Japanese corporations that are global household names. It has also added to worries in Japan that more manufacturing could be shifted overseas, hollowing out industry and jobs.

Like other Japanese automakers, Honda has been hit hard. It says the yen erased 22.5 billion yen ($288 million) from its April-June operating profit. The Tokyo-based maker of the Odyssey minivan and Accord sedan had initially counted on the dollar trading at 80 yen this fiscal year through March 2012. The dollar is now hovering between 76 yen to 77 yen.

The automaker has been moving production to the markets where vehicles are sold. For the more specialized cars still being exported from Japan, pressure is on to cut costs to make the business worthwhile, sometimes delaying model launches until such cuts are achieved, Honda officials say.

Squeezing positives out of a strong yen is a change of pace for Japan which has been, up to now, obsessed with trying to prop up the dollar to protect its exporting giants.

Such efforts have proved largely futile in recent years against larger global developments that nowadays include the debt crisis in Europe and fears of another recession in the U.S.

Japan's finance ministry most recently tried to weaken the yen in August, by buying dollars. That did send the yen lower but the effect lasted only days.

For Rakuten, a robust yen is key to its ambitions to one day become the world's No. 1 e-commerce company.

In September, Rakuten announced an agreement to buy British e-commerce site Play.com for 25 million pounds (3.3 billion yen, $43 million), following the acquisition of PriceMinister of France and German online shopping mall Tradoria.

The moves add to an empire that now sprawls across 10 countries, including Japan, raking in 90.7 billion yen ($1.2 billion) in April-June sales, a quarterly record for Rakuten. Its business also includes Buy.com of the U.S. and a partnership with Baidu Inc. in China as well as ventures in Thailand, Russia, Taiwan and Indonesia.

Kevin M. Carroll, who runs EA International, an environmental engineering and consultancy company in Tokyo, says the shrinking Japanese population and the high labor costs as well as corporate taxes in Japan are making overseas growth even more crucial for Japanese companies.

The days when a big Japanese corporation could prosper just by catering to customers in Japan are long over, said Carroll.

"The strength of the yen in most foreign markets works for Japanese companies as it places them in the envious position of acquiring foreign firms or technologies at a discount," he said.

___

Follow Yuri Kageyama on Twitter at http://twitter.com/yurikageyama

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Japan's Industrial Output Rises Less Than Expected, Weighed by Strong Yen - Bloomberg

Enlarge image Commuters crowd a train station in Tokyo. Employers cut payrolls by 160,000 and a further 200,000 workers retired or abandoned efforts to find a job, leaving the seasonally adjusted number of employed at 59.4 million.

Commuters crowd a train station in Tokyo. Employers cut payrolls by 160,000 and a further 200,000 workers retired or abandoned efforts to find a job, leaving the seasonally adjusted number of employed at 59.4 million. Photographer: Toshiyuki Aizawa/Bloomberg

Sept. 30 (Bloomberg) -- Curtis Freeze, founder of Honolulu-based Prospect Asset Management Inc., talks about Japan's economy, financial markets, and government. Freeze speaks from Tokyo with John Dawson on Bloomberg Television's "First Up." (Source: Bloomberg)

Japan’s labor force shrank last month to its smallest size since October 1987, when the nation’s stock-market benchmark was 185 percent higher and land prices were 85 percent greater than today.

Employers cut payrolls by 160,000 and a further 200,000 workers retired or abandoned efforts to find a job, leaving the seasonally adjusted number of employed at 59.4 million, the statistics bureau said today in Tokyo. Separate figures showed industrial production rose 0.8 percent from the previous month, less than all but three of 28 forecasts in a Bloomberg survey.

The data deepen concern that Japan’s recovery from the March earthquake will be stunted by manufacturers shifting operations abroad because of gains in the yen, a deterioration in consumer confidence and prospects for higher taxes at home. The challenges add to the burden of an economy already beset by a shrinking and aging population.

“We’ve seen an acceleration in the hollowing out of industry this year with the yen’s surge and the earthquake,” said Hiroshi Miyazaki, chief economist at Shinkin Asset Management Co. in Tokyo. “The government doesn’t have a sense of crisis about the yen and emerging economies are luring Japanese companies away.”

The yen traded at 76.74 as of 9:12 a.m. in London, about 1 percent from the post-World War II record high of 75.95 on Aug. 19. The Nikkei 225 Stock Average finished little changed at 8,700.29, compared with the peak of 38,915.87 when it closed out 1989, capping a four-year run when it soared almost 200 percent.

Prime Minister Yoshihiko Noda’s government on Sept. 27 said it will start implementing measures to cope with the yen’s gains, including subsidies for companies struggling to retain workers. Finance Minister Jun Azumi said today that Japan plans to bolster funds needed to intervene and lengthen monitoring of foreign-exchange market positions until the end of the year, from an initial plan to end the review this month.

“The yen staying around the high-70s could throw cold water on the Japanese economy’s recovery trend,” Azumi said at a press conference in Tokyo. “We will take bold actions when needed and we don’t rule out taking any necessary measures while closely monitoring speculative trading.”

Manufacturers including Panasonic Corp. have announced plans to shift operations overseas. Panasonic, one of the world’s largest consumer electronics companies, is moving the headquarters of its $57 billion procurement operation to Singapore from Osaka in the year starting April 2012, Masaaki Fujita, an executive in charge of the business, said this month.

Exports and retail sales data released this month also missed analysts forecasts, casting doubt on whether gross domestic product will rebound as much as forecast this quarter. GDP is expected to grow at a 4.6 percent annual pace in the three months through September, ending three quarters of decline, according to the average forecast of 42 economists surveyed by Japan’s government-affiliated Economic Planning Association.

The jobless rate fell to 4.3 percent in August from 4.7 percent as people left the workforce, today’s report showed. Household spending decreased 4.1 percent from a year earlier, compared with the median estimate in a Bloomberg News survey for a 2.8 percent drop.

A stagnating economy has also depressed consumer sentiment, with the nation’s Economy Watchers survey showing confidence among merchants and others who deal with consumers slipping to 47.3 in August, the first drop since March.

“I’m worried where things will go after this year, when we’ll start to see more of an impact from the strong yen and slowing growth in the U.S.,” said Noriaki Matsuoka, an economist at Daiwa Asset Management Co. in Tokyo. Reconstruction won’t be enough to fuel a “V-shaped rebound,” he said.

Japan plans to spend a total of 19 trillion yen ($247 billion) over five years for rebuilding after the magnitude-9 temblor and tsunami that devastated the northeast coast. The nation’s ruling Democratic Party of Japan this week proposed a 9.2 trillion yen temporary tax increase and selling of state assets to help pay for the effort.

In a sign that weaker global demand is affecting other Asian markets, South Korea’s industrial production also rose less than economist estimates in August, gaining 4.8 percent from a year earlier, Statistics Korea said today. Meanwhile, a gauge of Chinese manufacturing shrank for a third month in September, the longest contraction since 2009, according to the purchasing managers’ index released by HSBC Holdings Plc and Markit Economics today.

“Continuing yen strength will prompt companies to factor in a stronger yen in their business planning,” said Takahiro Sekido, a former analyst at the Bank of Japan and now a chief economist at Credit Agricole SA in Tokyo. “The biggest concern is the European debt crisis and the U.S. economy. With uncertain overseas demand,” Japan’s recovery may weaken, he said.

The International Monetary Fund predicted “severe” repercussions if Europe fails to contain its debt crisis or U.S. policy makers deadlock over a fiscal overhaul. Deepening debt woes in Europe have also put pressure on the yen’s exchange rate against its European counterpart, threatening to depress earnings at companies including Sony Corp.

To contact the reporter on this story: Aki Ito in Tokyo at aito16@bloomberg.net

To contact the editor responsible for this story: Paul Panckhurst at ppanckhurst@bloomberg.net

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Strong quake rocks northeast Japan

TOKYO – A strong earthquake has rocked northeastern Japan, which is still recovering from the devastating tsunami six months ago.

The quake Thursday had a preliminary magnitude of 5.6. There were no immediate reports of damage and no tsunami warning was issued.

The earthquake was centered off Fukushima, which was severely hit by the quake and tsunami in March that left more than 21,000 people dead or missing. Fukushima is about 150 miles (240 kilometers) northeast of Tokyo.

The March disaster touched off the worst nuclear crisis since Chernobyl, generating meltdowns, fires and explosions at the Fukushima Dai-ichi nuclear facility.

The plant's operator said there were no signs of abnormalities at the plant from the quake on Thursday.

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Strong earthquake hits northeast Japan, no tsunami (AP)

TOKYO – A magnitude-6.2 earthquake struck off Japan's battered northeastern coast Thursday, but there was no risk of a tsunami and there were no immediate reports of injuries or damage.

Japan's Meteorological Agency said the quake was centered off the coast of Ibaraki, about 140 miles (220 kilometers) east of Tokyo, at a depth of 6 miles (10 kilometers). The agency said there was no danger of a tsunami from the quake.

Nearly 20,000 people died or were left missing across Japan's northeastern coast after a massive earthquake and tsunami on March 11. The disaster damaged a nuclear power plant, forcing another 100,000 people to leave their homes because of a radiation threat.

The operator of the tsunami-hit Fukushima Dai-ichi nuclear power plant, Tokyo Electric Power Co., said the plant's cooling functions were intact after Thursday's quake and there was no change to radiation levels around the plant. The plant is about 80 miles (130 kilometers) northwest of the epicenter.

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Strong Earthquake Hits Northeast Japan - Voice of America

A powerful earthquake struck off Japan's northeastern coast late Thursday, but no tsunami warnings were issued.

The U.S. Geological Survey says a 6.2 magnitude quake struck near the coast of Honshu, about 155 kilometers east of Tokyo, at a depth of 10 kilometers.  

Japan's Meteorological Agency said there was no risk of a tsunami. There were no immediate reports of damage or injuries.

A massive earthquake and tsunami devastated northeast Japan in March, leaving nearly 20,000 people dead or missing and triggering a meltdown at Fukushima Daiichi nuclear power plant.  

A spokesman for Tokyo Electric Power Company, Fukushima's operator, said the plant was not damaged by Thursday's quake.

Some information for this report was provided by AP and AFP.

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Strong earthquake hits northeast Japan, no tsunami

Strong earthquake hits northeast Japan, no tsunami A magnitude-6.2 earthquake struck off Japan's battered northeastern coast Thursday, but there was no risk of a tsunami and there were no immediate reports of injuries or damage. Japan's Meteorological Agency said the quake was centered off the coast of Ibaraki, about 140 miles (220 kilometers) east of Tokyo, at a depth of 6 miles (10 kilometers). The agency said there was no danger of a tsunami from the quake. Nearly 20,000 people died or were left missing across Japan's northeastern coast after a massive earthquake and tsunami on March 11. The disaster damaged a nuclear power plant, forcing another 100,000 people to leave their homes because of a radiation threat.
15 Sep Shimoda, a small seaside city in Shizuoka prefecture, was home to as many as 200 geisha working its tea-houses as recently as 30 years ago. However, the number of geisha currently based in Shimoda has now declined to just five, prompting the rare intervention of government officials to keep their presence alive. As part of the plan, three prospective geisha will receive wages from central government employment subsidies for a six-month period, during which they will be trained fully in traditional singing, dancing and instrument playing. The geisha training proposal aims to reverse the city's dramatic decline of its geisha population - a problem replicated across much of modern-day Japan. (telegraph.co.uk)
15 Sep The Kyoto Prefectural Government has drafted an ordinance to make it the first prefecture in Japan to outlaw possession of pornographic images or video featuring children under 18. Under Japan's Law for Punishing Acts Related to Child Prostitution and Protecting Children, the manufacturing and trafficking of pornography featuring children under 18 is prohibited, but possession of child porn is not illegal. If Kyoto passes the draft and forms an ordinance outlawing possession of child pornography, it will seek to issue governor's orders to destroy the material and levy fines of up to 300,000 yen ($3,913) on offenders. (majirox news)
15 Sep Following her arrest last month for hemp possession, DJ and model Ayumi Takahashi has been arrested again - this time for stimulant use, reports the Sankei Shimbun (Sept. 14). Takahashi, 26, residing in Tokyo's Itabashi Ward, was cited today by officers of the the Tanishi station of the Tokyo Metropolitan Police for violating the stimulants control law. "I received it from my boyfriend's older brother," she is quoted as telling police. (Tokyo Reporter)
14 Sep Japan's Supreme Court said Tuesday it has turned down an appeal from a former Japanese Red Army member who was sentenced to life imprisonment by lower courts for his involvement in the 1977 hijacking of a Japan Airlines plane and the 1974 seizure of the French Embassy in The Hague. The defendant, Jun Nishikawa, 61, can still file an objection with the top court against the decision but it is limited to technicalities such as errors in wording. Tuesday's decision is expected to become final and binding as the court rarely accepts such objections. Lower court rulings show that Nishikawa conspired with other Japanese Red Army members to seize the French Embassy in The Hague in September 1974, held hostages for up to about 100 hours, and fired at policemen, wounding two of them. (Mainichi)
14 Sep "My boyfriend was so busy, he repeatedly cancelled our dates, and we finally wound up on a 'date' at his house, watching DVDs together. We were slouching on the sofa and he had his hands around my waist. It felt so good! Having gone so long without any lovin', my expectations were soaring." Thus begins an inspired amateur account of lusty romance from the June edition of ladies' magazine Renai Tengoku, as introduced in Shukan Bunshun (Sept. 8). "Then suddenly - you're never gonna believe this - his cell phone rang and he got summoned to an urgent job. He dashed into the other room to change his clothes, and there I sat, wallowing in shock and disappointment." (Tokyo Reporter)

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Quick steps to tackle strong yen needed: Japanese econ ministers

TOKYO (Reuters) – Economics Minister Motohisa Furukawa said on Sunday he and three other economy-related ministers in Japan agreed that measures to respond to a firmer yen need to be compiled quickly to alleviate the negative effect of the currency's appreciation on the domestic economy.

The agreement follows Prime Minister Yoshihiko Noda's comment on Friday that Japan is facing an unprecedented crisis where industry is hollowing out because of a strong yen.

The three other members of the newly formed Noda's cabinet were Finance Minister Jun Azumi, Trade and Energy Minister Yoshio Hachiro, and Tatsuo Hirano, who is in charge of reconstruction following a massive quake and tsunami in March.

In the first meeting of the Noda government's economy-related ministers, no concrete steps were discussed, Furukawa said.

Azumi said earlier on Sunday he will keep an eye on speculative moves in the currency market and take a decisive step if necessary, in a sign he will follow the footsteps of his predecessor Noda, who as finance minister, led currency intervention three times to curb the yen's rise.

(Reporting by Shinji Kitamura, writing by Kiyoshi Takenaka; Editing by Ed Lane)

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Quick steps to tackle strong yen needed: Japanese econ ministers (Reuters)

TOKYO (Reuters) – Economics Minister Motohisa Furukawa said on Sunday he and three other economy-related ministers in Japan agreed that measures to respond to a firmer yen need to be compiled quickly to alleviate the negative effect of the currency's appreciation on the domestic economy.

The agreement follows Prime Minister Yoshihiko Noda's comment on Friday that Japan is facing an unprecedented crisis where industry is hollowing out because of a strong yen.

The three other members of the newly formed Noda's cabinet were Finance Minister Jun Azumi, Trade and Energy Minister Yoshio Hachiro, and Tatsuo Hirano, who is in charge of reconstruction following a massive quake and tsunami in March.

In the first meeting of the Noda government's economy-related ministers, no concrete steps were discussed, Furukawa said.

Azumi said earlier on Sunday he will keep an eye on speculative moves in the currency market and take a decisive step if necessary, in a sign he will follow the footsteps of his predecessor Noda, who as finance minister, led currency intervention three times to curb the yen's rise.

(Reporting by Shinji Kitamura, writing by Kiyoshi Takenaka; Editing by Ed Lane)

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Japan new PM Noda enjoys strong voter support (Reuters)

TOKYO (Reuters) – Two-thirds of Japanese voters support new Prime Minister Yoshihiko Noda as his call for unity within the ruling party and conciliatory stance toward the opposition raised hopes for speedy policy implementation, newspaper polls showed on Sunday.

That was a sharp turnaround from his predecessor, Naoto Kan, who saw his support fall below 20 percent after suffering a political stalemate due to rebels within his Democratic Party and a divided parliament, where the opposition controls the upper chamber and can block bills.

But potential trouble for Japan's new leader is already brewing as the Asahi newspaper said Noda had received political donation from a non-Japanese resident. A similar development forced Seiji Maehara to step down as foreign minister in March.

Noda, a fiscal hawk, became Japan's sixth premier in five years last week, pledging to quickly tackle fiscal reforms to rein in huge public debt -- now twice the size of the country's $5 trillion economy -- but with an eye on growth.

Support for the Noda government was 67 percent, according to a poll by the Nikkei business daily, compared with 19 percent for Kan's cabinet in the previous survey conducted in late July.

Polls by three other major newspapers, the Yomiuri, Mainichi and Asahi, showed that support for Noda, who is tasked to forge a new energy policy while ending a radiation crisis caused by a deadly tsunami in March, came to 65 percent, 56 percent and 53 percent, respectively. Another poll by Kyodo news agency showed similar results on Saturday.

In the Nikkei survey, 36 percent of those polled said they support Noda's Democratic Party. That compares with 30 percent in favor of the main opposition Liberal Democratic Party (LDP), boding well for the DPJ's fortunes in the next election.

In the previous survey in July, more voters supported the LDP than the ruling party.

A lower house election is not mandated until late 2013 and Noda on Friday ruled out a snap election for now.

Clouding the high popularity luster, however, the Asahi said Noda's fund management body had received 158,000 yen ($2,058) in political donation from a non-Japanese resident in three years to 2003.

He may also have received about 150,000 yen from another foreign national, the paper added.

It is illegal in Japan for lawmakers to take political contributions from non-Japanese residents, if done intentionally.

The statute of limitations on both cases has already run out, the newspaper said. But they could nonetheless be used by the opposition camp as ammunition to undermine the new government.

The Asahi quoted Noda's office as saying that neither Noda or his office had been aware of the donations in question.

READY FOR INTERVENTION IF NEEDED

Besides the prolonged nuclear crisis and mounting public debt, Noda needs to tame a firmer yen that is hurting Japan's export-reliant economy and enact a third extra budget to fund Japan's reconstruction efforts from the March disaster.

Noda plans to set up a national strategic council, where government ministers, the central bank, businesses and labor unions will discuss key issues such as tax and social security reforms and the country's budget, the Nikkei said.

The council, similar to a powerful policy-making body set up by former popular Prime Minister Junichiro Koizumi, will enable Noda and Bank of Japan Governor Masaaki Shirakawa to respond flexibly to economic issues while maintaining central bank independence, the newspaper said.

As finance minister in Kan's cabinet, Noda led currency intervention three times to curb the yen's rise, and said on Friday Japan was facing an unprecedented crisis where industry was hollowing out because of the yen's appreciation.

In a sign that he will follow his predecessor's steps on currency, new Finance Minister Jun Azumi said he would not hesitate, if needed, to step in the currency market.

"I'm highly concerned that one-sided yen's appreciation is continuing in the foreign exchange market," Azumi said on public broadcaster NHK on Sunday.

"I will keep my eyes on speculative moves and maintain the stance of taking a decisive step when necessary."

Azumi said he intended to tell a Group of Seven (G7) finance ministers' meeting this week that fiscal conditions in the United States and European countries were among the factors behind a firmer yen and that he aimed to share a sense of urgency with his counterparts.

On the third extra budget, which is needed to help Japan's tsunami-damaged northeast recover, Azumi said he aimed to submit a budget bill to parliament as soon as mid-October.

Azumi, also following in Noda's footsteps, said that drastic cuts in government expenditure alone would not be able to cover rebuilding costs, suggesting that tax rises may be needed. ($1 = 76.770 Japanese Yen)

(Reporting by Kiyoshi Takenaka; Editing by Yoko Nishikawa)

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Strong yen may see 46% of makers leave

The Yomiuri Shimbun

Forty-six percent of major manufacturers would relocate their plants and research and development facilities overseas if the yen remained at the level of 76 yen to the dollar for six months or longer, according to a survey conducted by the Economy, Trade and Industry Ministry.

Thirty-two percent of major manufacturers said their operating profit would drop more than 20 percent if the yen stayed at that level for six months or longer.

The survey shows the hollowing out of the nation's industry may be accelerated if the yen stays strong.

The survey announced by the ministry Thursday covered 154 companies--61 major manufacturers and 93 small and midsize companies--and was conducted Aug. 22 to 26 after the yen surged to a postwar record high of 75.95 yen against the dollar in New York on Aug. 19.

About 80 percent of the companies said their profit would drop if the yen remained at the 76 yen level for six months or longer.

More than 50 percent of major manufacturers said they would procure more materials and parts from overseas to cope with the superstrong yen. This likely would deal a blow to domestic small and midsize manufacturers who have business relationships with them.

Twelve percent of major manufacturers said their profit would increase because the yen's appreciation would push down procurement costs of raw materials.

Meanwhile, 18 percent of major manufacturers said China, South Korea and other countries had approached them to lure them to their countries. Those countries are believed to have presented favorable conditions, such as tax breaks, subsidies and exemption from electricity charges.

Among measures to deal with the surging yen, 87 percent of major manufacturers said they want the government to lower the effective corporate tax rate, which is higher than those of other countries.

Sixty-three percent want the government to continually intervene in foreign exchange markets, while 58 percent want it to promote economic partnerships, such as the Trans-Pacific Partnership (TPP) free trade agreement.

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Japan To Announce Further Steps To Cope With Strong Yen - Wall Street Journal

AUGUST 25, 2011, 11:33 P.M. ET

-- Japan to announce more suggestions for coping with strong yen on Monday, Economy Minister Kaoru Yosano says.

-- Market intervention "not a tool that can be used frequently," Yosano says.

-- Japan may be shifting towards strategy of coping with, rather than fighting against, strong currency.

(Adds more comments from economy minister in 5th, last paragraphs.)

TOKYO (Dow Jones)--Japan's economy minister said Friday that the government will release on Monday a list of suggestions for how the next administration, ...

-- Japan to announce more suggestions for coping with strong yen on Monday, Economy Minister Kaoru Yosano says.

-- Market intervention "not a tool that can be used frequently," Yosano says.

-- Japan may be shifting towards strategy of coping with, rather than fighting against, strong currency.

(Adds more comments from economy minister in 5th, last paragraphs.)

TOKYO (Dow Jones)--Japan's economy minister said Friday that the government will release on Monday a list of suggestions for how the next administration, ...

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Japan sets $100B to manage strains of strong yen (AP)

By TOMOKO A. HOSAKA, Associated Press Tomoko A. Hosaka, Associated Press – 14 mins ago

TOKYO – Japan's government on Wednesday unveiled a $100 billion loans program to ease the strains of a strong yen and encourage companies to turn adversity into opportunity.

The unconventional one-year scheme aims to prompt Japanese companies to shift their yen holdings into foreign currencies and spur overseas mergers and acquisitions. It came coupled with a new rule requiring major financial firms to report their currency trading positions through the end of September.

The emergency steps represent the latest attempt by the government to wrestle with a Japanese currency that it fears is undermining the country's export-driven economy and recovery from the March 11 earthquake and tsunami.

"I hope this will help to address the one-sided strength of the yen," Finance Minister Yoshihiko Noda told reporters, according to Kyodo News agency.

A strong yen erodes the value of exporters' profits when brought back to Japan and pushes up prices of their goods overseas. Officials also worry about job losses at home as companies move production out of Japan to insulate themselves from the rising yen.

The finance ministry intervened in currency markets earlier this month as the yen flirted with record highs against the dollar. The impact proved to be short-lived. Last week the dollar fell under 76 yen, which was a new post-World War II high for the Japanese currency.

Through the program, the government will send foreign currency reserves to the Japan Bank for International Cooperation. The state-operated bank, known as JBIC, would then extend loans to commercial banks so they can help companies with overseas investments and secure natural resources.

While a strong yen saps overseas earnings, it also makes potential acquisitions outside of Japan less expensive.

Japanese companies have embarked on an aggressive global shopping spree as a result. Recent data from Dealogic shows that the value of overseas takeovers and acquisitions by Japanese firms in 2011 has more than doubled from a year earlier.

Asahi Group Holdings Ltd. last week agreed to buy New Zealand beverage maker Independent Liquor Ltd. in a deal worth $1.2 billion. Just weeks earlier, rival Kirin Holdings Co. said it would buy Brazilian brewer Schincariol Group for $2.5 billion in one of the largest overseas takeover bids by a Japanese company this year.

JBIC will separately funnel 150 billion yen ($1.96 billion) of its own money to the program.

The second prong of the government's efforts is an attempt to limit speculation that officials suspect might be fueling sharp swings in the yen. Finance Minister Yoshihiko Noda has said repeatedly in recent weeks that the yen's moves are unbalanced and suggested that the government would act against speculators seeking short-term profits.

The central bank released a brief statement in support of the finance ministry's measures, saying they will "contribute to the stability of the foreign exchange market."

"The Bank of Japan will continue to carefully monitor the effects of developments in the foreign exchange market on the future course of economic activity and prices," it said.

Economists, however, expressed skepticism.

Junko Nishioka, chief economist at RBS Securities Japan, described the steps as "not straight forward."

She questioned the government's decision to focus on mergers and acquisitions overseas at a time when Japan needs help sustaining production at home.

"The most critical issue the Japanese economy has at this moment is a risk of a hollowing out" of industry, Nishioka said in a report to clients.

"We believe today's decision is unclear and will have little impact to alleviate the yen's appreciation pressure," she said.

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Views mixed on strong yen

Small businesses voiced concern Saturday about the yen's growing strength over the dollar, while travelers welcomed the chance to flex renewed purchasing muscle overseas.

In New York on Friday, the dollar touched a postwar low of ¥75.95.

Makoto Onishi, an official of wire maker Osaka Seiko, said he was worried that the yen's rise will dampen the economy. "We're just expecting a recovery around autumn in transactions for auto parts, which have been hurt by the (March 11 disaster). It's like we've had cold water thrown on us," he said.

Meanwhile at Narita airport, many travelers welcomed the yen rise. "I'm happy because I'm going to shop," said Seoul-bound Naomi Uchida, 27.

But a Macau-bound cram school owner, 59, said she was worried. "The economy could worsen and a growing number of parents might not be able to spend as much money on children's education."

"There may be advantages for businesses engaged in imports or investments," a 60-year-old man from Sendai's Aoba Ward said. "I just hope politicians do their best not to encourage businesses to shift operations abroad."

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Strong yen threatens to force Japanese firms to shift production overseas - Mainichi Daily News

Nissan Motor Co.'s Oppama factory in Yokosuka, Kanagawa Prefecture, is seen on July 2. (Mainichi)

Japanese companies including Toyota Motor Corp. could have no option but to shift production overseas if the yen, which recently hit a post-war record high against the U.S. dollar, remains strong for a long time.

"The strong yen will affect a wide range of businesses. I'm worried that Japan's entire industrial sector could experience a downturn," a top executive at a major electronics company told the Mainichi on Aug. 19. An official of a heavy-equipment manufacturing firm said, "Our international competitiveness will steadily decline."

According to a survey of 119 major Japanese companies conducted by the Mainichi from mid-July to early August, the average exchange rate the companies assumed against the dollar for the current business year (ending at the end of March 2012) was the 82 yen level. Currently, the yen is 6 yen higher than that against the dollar.

As for the auto industry, for every one-yen increase against the dollar Toyota's operating profits are projected to drop by 30 billion yen and Nissan Motor Co.'s by 20 billion yen. Toyota fell into the red in the April-June quarter, and calculates that the strong yen cut profits then by 50 billion yen. Toyota is trying to keep its production lines in Japan, but a senior company official said, "We have no option but to have more parts produced abroad."

Mitsubishi Electric Corp. set its assumed exchange rate at 85 yen to the dollar for the business year ending March 2012. If the rate against the dollar is 1 yen stronger than that, profits will drop by 4 billion yen.

"We have to take conventional measures such as cost-cutting and increasing imports of raw materials, but if the yen continues to be strong for a long time, there are limits to what one company can do to deal with it," said a Mitsubishi Electric official.

Takashi Miyoshi, Executive Vice President of Hitachi Ltd., said, "We have to do more business overseas. Otherwise, we will lose cost competitiveness."

The strong yen has merits: people can travel abroad from Japan and companies in Japan can import raw materials from abroad at lower prices. But most economists believe that the adverse effects of the strong yen on the economy caused by poor business performances will outstrip the merits of the strong yen.

The government and the Bank of Japan intervened in the foreign exchange market to sell the yen on Aug. 4, but the effects of such efforts were limited and business managers have become more frustrated. Prime Minister Naoto Kan has said his government would decide on whether to join the Trans-Pacific Partnership (TPP) free trade pact, but that decision has yet to be made. While the government has failed to implement measures to help boost corporate competitiveness, the yen has strengthened.

"Under these circumstances, production bases could be moved overseas," said a top official of a steel company.

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Strong play has Kofu's Havenaar out of father's shadow

KOFU — Ventforet Kofu might be struggling to keep their heads above water this season, but striker Mike Havenaar is making a big splash in the J. League's first division.

Kofu went into its first top-flight campaign since 2007 hoping to build on the momentum that carried it to a runnerup finish in J2 last year, but the step up in quality has so far proved beyond the reach of the Yamanashi club. Promising early results have spiraled into a steady free fall to leave Ventforet currently six points from safety in the relegation places, with manager Toshiya Miura making way for Satoru Sakuma earlier this month in a bid to escape the drop.

Amid the gloom, however, Havenaar's form has given room for optimism. The Hiroshima-born son of Dutch former J. League goalkeeper Dido Havenaar has hit nine goals so far in a breakthrough season, picking up from where he left off last year as J2 top scorer with 20.

"For the team it's not going so well because we're in the bottom three, but personally I've got nine goals and it's been very good," the 24-year-old said at Ventforet's training ground earlier this week. "But the team is more important than myself, and it's not going so well. The level in the first division is completely different, and I need to learn a lot of things still. But so far I'm doing very well and I hope to learn more and get better with every single game."

Wins over heavyweights Nagoya Grampus, Gamba Osaka and Kashima Antlers have provided rare moments of glory for Ventforet, but Havenaar — who scored in each of those victories — knows that adding Urawa Reds' scalp on Saturday will mean nothing unless his team can capitalize on the good times.

"Nagoya had a lot of injured players and we were lucky to win, but that gave us some confidence," he said of Kofu's 3-1 victory over the champions in May. "But as it turned out it wasn't so good for the team because we haven't been able to win much since then. Maybe for those teams it's their motivation. We are a very weak team so maybe they think it's going to be an easy game. But we try our best every game, so maybe on Saturday we can win."

Havenaar's form has not escaped national team manager Alberto Zaccheroni's attention, with the 194-cm forward called up for a training camp prior to last week's friendly against South Korea. Although Havenaar missed the cut for the final squad, he has no doubt where his allegiance lies despite his Dutch parentage.

"I was born in Japan, I was raised here and all my friends are here," said Havenaar, who attended Yokohama International School. "I've never lived in the Netherlands and I've got nothing there. At the World Cup I'm always cheering for the Netherlands, but my heart is in Japan so I would rather be a Japanese national team player.

"It was a big honor to be called up because I had been playing all my life in Japan, and as a professional I wanted to be in the national team of Japan. It was my dream and what I have always looked forward to. I didn't make the team last time against Korea, but at the camp I had a good experience and I would like to keep my confidence going and get called up again."

But Havenaar's pride in his Japanese identity has not always been shared by others. An away game against Kashiwa Reysol in April was marred by racial taunts, raising questions over fan behavior in a season where Shimizu S-Pulse's Iranian manager Afshin Ghotbi has also suffered abuse.

"During the Kashiwa game they shouted "go back to the white land" and all that crazy stuff," Havenaar said. "That didn't matter to me, but after that they were saying things about my mum and dad, and I didn't feel so good about that so I reported it. The things they say about me I don't mind, but the things they say about my parents I can't tolerate.

"It's not that big a problem, but with the coach from Shimizu S-Pulse it was just stupid supporters in the crowd. It's not a huge problem, but maybe some people want to say something without thinking what they are talking about."

Having begun his career at Yokohama F. Marinos, Havenaar's season has also been clouded by the sudden death of former teammate Naoki Matsuda. Matsuda died two days after collapsing in training with JFL team Matsumoto Yamaga on Aug. 2, and for Havenaar the grief is still raw.

"I went to meet him the day before he passed away, and it was just a sad thing to watch because I have seen him fighting in games," he said. "He was a veteran player who would always give you motivation when you were playing and a lot of advice in training, so it was just a sad thing to watch.

"I just kept crying the day I saw him alive with all the tubes in his mouth and nose. It's just something you couldn't watch. The next day he passed away and it was a very sad feeling inside."

For all the problems along the way, however, this season has been an overwhelmingly positive experience for Havenaar. For one thing, after growing up watching a father who made 222 appearances for Japanese clubs, he is no longer living in the shadow of a more illustrious name.

"I watched every game my dad played in, and I was born in Japan and brought up in Japan, so I always thought that one day I would play in the J. League as well," he said. "When my name came up in the newspapers it was always 'Dido's son, Mike Havenaar,' and I didn't like that. But now it's just 'Mike Havenaar,' and that's like saying I have become, not a superstar yet, but someone that everyone knows. Now I have my own status."

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Strong earthquake hits north-eastern Japan, tsunami warning issued - Sacramento Bee

TOKYO - A magnitude-6.8 earthquake jolted north-eastern Japan on Friday and a tsunami warning was issued, the Meteorological Agency said.

The warning was issued for the coastal areas in the prefectures of Fukushima and Miyagi.

No immediate casualties or damage were reported.

The quake occurred at 2:36 pm (0536GMT) with its epicenter off Fukushima prefecture at a depth of 20 kilometers, the agency said.

No immediate new damage was found at the damaged Fukushima Daiichi Nuclear Power Station, public broadcaster NHK said, citing operator Tokyo Electric Power Company.

The same region was hit by a magnitude-9.0 quake and tsunami on March 11, causing damage to the plant, which has been leaking radioactive material ever since.

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Strong quake hits off NE Japan; no reported damage (AP)

TOKYO – A magnitude-6.8 earthquake struck off Japan's northeastern coast Friday, triggering a tsunami advisory that was later lifted. There were no immediate reports of damage or injuries in the temblor, which rattled the area devastated earlier this year by a massive quake and tsunami.

The 2:36 p.m. (0536 GMT) quake was centered about 185 miles (300 kilometers) northeast of Tokyo and at a depth of 12 miles (20 kilometers), slightly south of where the magnitude-9.0 temblor struck March 11, Japan's Meteorological Agency said.

The agency issued a tsunami advisory, predicting waves of 20 inches (50 centimeters) along the coast of Miyagi and Fukushima prefectures, where a nuclear plant crippled by March's quake-spawned tsunami is located. The agency lifted the advisory about 30 minutes later.

There were no abnormalities in key equipment at the Fukushima Dai-ichi nuclear power plant, said Chie Hosoda, an official with Tokyo Electric Power Co., the plant's operator. She said some of the plant's workers assigned to the coastal side of the facility temporarily retreated inside the building.

This was the first sizeable quake in the area in over a month. In the weeks following the huge March quake, Japan was frequently rocked by aftershocks, including several stronger than magnitude 7.0. Their frequency and size have declined considerably.

In Onagawa, about 210 miles (340 kilometers) north of Tokyo, town official Hironori Suzuki said there were no immediate reports of damage or injuries. There was no visible swelling of the ocean, he said.

"It was a rather big one, perhaps it was because we are still in a makeshift office," Suzuki told public broadcaster NHK. Suzuki said the town has urged all residents via community broadcast to stay away from the coast and evacuate to higher ground.

The quake caused buildings in Tokyo to sway. Bullet trains and several other local train services in the region were temporarily suspended for safety checks.

Just over 20,000 people died or disappeared across Japan's northeastern coastline after the March earthquake and tsunami. Some 100,000 others were forced to evacuate their homes because of the threat of radiation from the crippled Fukushima Dai-ichi nuclear plant.

March's tsunami destroyed cooling systems at that plant, sending its reactors to core meltdowns that caused massive amount of radiation to leak out of the complex. The radiation leaking has since dramatically declined.

The government has since ordered nuclear plant operators to take additional safety measures in case of a major quake and tsunami.

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