David Fuller and Eoin Treacy's Comment of the Day
Category - Japan

    See Food: Why Robots Are Producing More of What You Eat

    This article by Natashe Khan for the Wall Street Journal may be of interest to subscribers. Here is a section:

    Food manufacturers have been early adopters of new technologies from canning to bread slicers, and vision automation has been used for many years for tasks such as reading bar codes and sorting packaged products. Leaders now are finding the technology valuable because robot eyes outpace the human eye at certain tasks.

    For years, Tyson Foods Inc. used sensors to map chicken fillets so they could be cut to the precise specifications required by restaurant customers that need them to cook uniformly. But exposure to the high pressure, high temperature water there kept causing equipment failures.

    Now technical improvements, tougher materials and declining prices mean the company can integrate vision technology in facilities including the new $300 million chicken-processing plant in Humboldt, Tenn., said Doug Foreman, who works in technology development at the Springdale, Ark.-based food company. The technology could help optimize the use of each part of the bird, he added.

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    Shinzo Abe's quiet social revolution

    Thanks to a subscriber for this article by Hiroshi Marutani for Nikkei may be of interest to subscribers. Here is a section: 

    In his second stint as prime minister, Abe seems to have finally understood the secret to the LDP's longevity: an all-engulfing pragmatism. Reality over ideals. This has been clearest in Abe's decision to expand acceptance of foreign workers. Under Abe's administration, the number of foreign workers has almost doubled to 1.3 million. Laborers from China, Vietnam and the Philippines have poured into Japan to fill gaps in the health care, construction "With the economy performing so well, it is becoming apparent that hiring is tight," Abe told Nikkei. "Worker shortages are starting to hamper a variety of fields."

    The ills of a shrinking population were hardly noticeable during the country's long deflationary spiral. But after growth returned in 2013, businesses began to shout their concerns about a smaller workforce.

    "Nursing facilities, for instance, have a severe lack of hands," said Abe, whose recognition of the issue has been heavily shaped by Yoshihide Suga, his chief cabinet secretary since 2012.

    Suga realized the need for more workers in nursing facilities last fall, when local caregivers raised the issue with him and requested foreign staffers. He gathered officials to look into the problem and was told that there was adequate manpower.

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    What is behind the Bank of Japan's ETF buying surprise?

    This article by Leo Lewis for the financial Times may be of interest to subscribers. Here is a section:

    As well as its day-to-day predictability, the programme invited running assessments of how much the BoJ might spend month to month. Since its target for the year was clearly stated, it was possible to calculate how far ahead or behind the implied pace it was. In early July, for example, analysts noted that over the first 124 trading days of the 245-day trading year, the BoJ had bought ETFs that annualised at a pace of ¥7tn — or ¥1tn ahead of target.

    Because of that, Travis Lundy, an analyst who publishes research on Smartkarma, said that given the extent to which the BoJ had adjusted its buying patterns over the past seven years, it was premature to arrive at the conclusion about stealth tapering after the results of just a few August sessions.

    “While there is a little bit of stretch in what has often been deemed a trigger, for the moment the BoJ is still buying at a ¥5.7tn-yen-a-year pace, which is the stated policy aim,” he said.

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    Bonuses Push Up Pay for Japanese Workers Yet Spending Falls

    This article by Connor Cislo for Bloomberg may be of interest to subscribers. Here is a section:

    Driven by the tightest labor market in decades, wages in Japan have grown steadily since mid-2017, and even real wages are starting to pick up. That’s welcome news for the Bank Japan, which recently adjusted monetary policy in an effort to make its easing program more sustainable. If households become convinced that pay hikes will keep coming, they’ll be more willing to increase spending, which will drive further price increases and economic growth. The problem is that employers favor pouring pay hikes into bonuses, which can be taken away, rather than permanent increases in wages.

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    Corporate Japan's capital spending plans reach 38-year high

    Thanks to a subscriber for this article by Jun Watanabe for Nikkei’s Asian Review. Here is a section:

    The latest survey shows manufacturers boosting capital expenditures by 27.2%. This is due in large part to investment and research and development outlays for electric vehicles, on top of redesigns. Extending ranges for electric autos requires development of better batteries and other onboard components. On that front, chemical and electric machinery makers are expected to step up their own investments.

    For the nonmanufacturing sector, spending is forecast to rise 18.5%. In addition to urban construction projects, contractors are building massive logistics centers to handle a surge in online orders. Construction starts for hotels remain high ahead of the 2020 Tokyo Olympics.

    For the first time in its survey, the DBJ asked companies about the impact of labor shortages. About 60% of nonmanufacturers said a lack of workers is hindering business development. Furthermore, they see the situation growing worse three years down the road. The DBJ expects this to drive more labor-saving investments among retailers and wholesalers.

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    Japanese markets unsettled on reports that the Bank of Japan will discuss policy change

    Thanks to Niru Devani for this report and commentary.

    Here is an excerpt from the article posted on Bloomberg on reports that the Bank of Japan will discuss policy change at its meeting next week.

    A dramatic day for Japan’s debt market saw yields surge on media reports of possible changes to the nation’s ultra-loose monetary policy, spurring the central bank to offer to buy an unlimited amount of bonds.

    The yield on 10-year government securities soared as much as six basis points to 0.09 percent, its biggest increase in almost two years, pulling the yen higher and weighing on stocks. While the yield came down after the purchase offer by the Bank of Japan, it then bounced back to just one basis point below the day’s high.

    Any change to BOJ’s stimulus would be the first since 2016 when it introduced control of the yield curve in a bid to manage the impact of its bond purchases and negative interest rates. Still, profits for banks and bond traders continue to be depressed, with reports from Reuters, Asahi and Bloomberg suggesting that officials are debating ways to further mitigate the side effects.

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    One in ten Tokyoites in their 20s are now foreigners

    Thanks to a subscriber for this article by Kanako Watabe for Nikkei Asian Review. Here is a section:

    Among 20-somethings living in Japan's capital, one out of 10 are foreign-born, reflecting the rapidly shifting profile of the country's working population.

    Throughout Japan, foreigners in their 20s numbered 748,000 at the beginning of the year, or 5.8% of the total, the government reported Wednesday. The figures exclude foreign nationals that are here for short stays, and typically include those with residency credentials staying for over three months.

    In all, the country's population of non-Japanese residents grew 7.5% to a record 2,497,000 people. Many of them live in Tokyo, with the largest portion -- around 42,000 -- housed in the city's Shinjuku ward.

    At 3 p.m. on weekdays, Shinjuku's government offices are jam-packed with people filling out moving notices and other forms. Over half of those waiting in line are young people of non-Japanese descent, and a mixture of English, Chinese and other languages fills the air. More than 40% of the foreigners are 20 years old.

    While Shinjuku's native-born residents in their 20s shrank 7% over five years, the number of foreigners in the ward soared by 48%. One convenience store near JR Shinjuku Station has hired a 31-year-old Chinese woman. "The store wouldn't run if I'm away from my shift," she said.

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