The wire services are all jumping up and down about the rise in consumer spending. Nice, up 0.7% in real, that is to say nominal, money.
Japan, the only advanced industrialized economy where real GDP is a complete, delusional fiction.
I tend to look further down the report and worry about the immense rise in private residential investment (up 2.3%). Like those of us in Tokyo and Aichi could ignore the forests of kōkyū jūtaku shooting up into the sky (Can you believe a
Private non-residential investment--all that capex and all those great glass temples of commerce--has slowed a bit--but only after soaring like bird earlier this year.
Government spending also increased but only after falling like a stone during the last few months of the Koizumi administration (hints of a lessened commitment to fiscal reform, anyone?)
Also interesting is the quarter-to-quarter drop in imports, with negative growth in the nominal figures. This took place as the steep drop of the value of the yen in Q4 kicked European exporters in the gut. Before predicting serious trans-Eurasian and to a lesser extent trans-Pacific friction over Japan's weak appetite for imports, however, let us see how much of this drop can be attributed to falling energy prices.
Look today for a dipping dollar, a plummeting euro-yen rates, rising bond prices and Bank of Japan officials dancing naked on the Nihonbashi and kissing the sidewalk.