"They're [Japan] manipulating the yen and it creates big differences in what they can sell their automobiles for," said Sen. Debbie Stabenow, D-Mich., who represents thousands of Detroit-based auto workers. "Most of their vehicles are still coming from Japan." Complete article here... (It seems the other forum lost the article. Sorry
I'm seeing a dead link and can't find the article. My guess is that a mod killed the original post if the full text of the article was copied, which I believe is a no-no. Anybody have a link to the original source?
"They're manipulating the yen and it creates big differences in what they can sell their automobiles for," said Sen. Debbie Stabenow (news, bio, voting record), D-Mich., who represents thousands of Detroit-based auto workers. "Most of their vehicles are still coming from Japan." Toyota may face backlash from congress. Toyota's eighth North American assembly facility, to be located just outside of Tupelo, will have the capacity to build 150,000 vehicles annually of Toyota's Highlander sport utility vehicle. Production is scheduled to begin by 2010. The new plant represents a 1.3-billion-dollar investment by Toyota and is expected to create some 2,000 new jobs for the region at a time when Detroit automakers are in a major reorganization, eliminating tens of thousands of jobs. Toyota to build SUVs in Mississippi.
Can someone explain this "manipulating" business? Seems like if they are doing that, they are just hurting themselves?
<div class='quotetop'>QUOTE(Beryl Octet @ Mar 3 2007, 08:09 AM) [snapback]399489[/snapback]</div> When you, i.e. Japan, manipulates its currency it's done in a way that can effect the exchange rates. Most companies make "deals" for supplying product based on current enchange rates and possibly in the currency of the supplying country. If you can manipulate the exchange rate it effects the amount of money the buyer pays for the products. In addition, at the end of the fiscal year many off-shore companies have some kind of "settlement" that occurs and essentially returns excess profits to the parnet company. By manipulating exchange rates you can effect the amount of money that is returned to the parent and thus stripping money from the subsidiary. By doing this it also effects the amount of taxes the subsidiary pays in their home country.
bah! they're a bunch of cry babies. why don't they make a reliable product and they'll see that consumers will buy their products! just last week there was a report that "US autos are catching up in reliability" which just says that they indeed have low reliability.
Well the yen has appreciated sharply against all Western currencies in the last few days. 115 to the USD now. The yen market in particular is subject to "carry trades" where dealers borrow yen at minimal interest rates to invest in high-yielding countries. This involves selling yen, so also weakens the currency, perhaps moreso than intervention by Japan's central bank. I'm no expert, so I'll leave it at that.
