How do Japanese do when Surplus Condition on International Trade
To continue my previous post ‘Floating Exchange Rate, Currency up and down, let us see how Japanese do to stabilize their money supply when surplus on international trade?
When surplus happened, that money didn’t entered to Japan, but let it outside as (foreign exchange) devise.
So what they do with their surplus?
Have you ever heard that Japanese become prime lender? Japan replaces the surplus to foreign investment, donor to poor countries, Move to World Bank, IMF as creditor country. Yeah! They do that. So we have to thank Japan that Japan becomes donor country. They avoid Internal Money Supply with aid (low interest rate donor) to third countries. Both of the rules have benefits and no one (countries) are harm with the Japanese move. Read more »
Tags: Hot Money, Interest Rate, International Payment, International Trade, Money Supply, Surplus, Yen
