<h3><span class="strongInContent">In these uncertain and unstable times of world affairs and politics, can we &#8220;gather information&#8221; and &#8220;make decisions&#8221; on our own?</span></h3>
<p> The &#8220;New NISA&#8221; system, which will further expand the tax exemption for investment assets, will begin in 2012.</p>
<p> In the long-lasting deflationary economy, it was fine to simply deposit assets without investing them, but as we enter an inflationary era of rising prices, deposits are losing their asset value. Under such circumstances, there is a great deal of talk here and there about encouraging the general public to invest, as if to say, &#8220;Don&#8217;t miss out on taking advantage of the new NISA.</p>
<p> Professional investors will always be thinking about what investments they should make, regardless of the economy or the investment environment. On the other hand, is now the right time for the average person with limited economic and investment knowledge to invest?</p>
<p> If you are planning to invest over a period of decades, there should be a time when you can calmly assess the situation. For the average person, now may be the right time.</p>
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<h3><span class="strongInContent"> Even if people say that long-term investment is safe, it does not mean that the market will always go up.</span><span class="strongInContent"> </span></h3>
<p><span class="strongInContent"> &#8220;Japanese stock prices fell in the first half of 2012.</span><span class="strongInContent"> Japanese stock prices may fall in the first half of 2012 and pick up in the second half.</span></p>
<p> &#8220;Japanese stock prices may fall in the first half of 2012 and pick up in the second half,&#8221; said Saisuke Sakai, chief economist at Mizuho Research &amp; Technologies. Some experts believe that it may be a good idea to take a cautious look at the investment environment for the time being.</p>
<p> Hiroko Ogiwara, an economic journalist, has this to say about the shift of funds from savings to investments.</p>
<p><span class="strongInContent"> She says, &#8220;Investments should be made in a stable environment and in a normal financial market. But now, it is unstable in every way. The new NISA</span><span class="strongInContent"> Even if you are told that long-term investments using the new NISA will be safe, the market is not guaranteed to go up steadily.</span></p>
<p> The stock market is very distorted,&#8221; Ms. Ogiwara points out.</p>
<p> Large investors in the Japanese stock market include the Bank of Japan, which purchases a large number of stocks through index-linked exchange traded funds (ETFs) as a method of monetary policy, pension funds (Pension Fund Management Corporation), and foreign investors. The presence of these investors is so large that individual investors are overshadowed in the stock market.</p>
<p><span class="strongInContent"> This is where the general public will be called in with the new NISA.</span><span class="strongInContent"> The new NISA will bring in the general public. It would be especially sinister if professionals, such as foreign investors, are quick to run away, win and run away, and the general public is left behind.</span></p>
<figure id="attachment_349900" aria-describedby="caption-attachment-349900" style="width: 734px" class="wp-caption alignnone"><a href="#" data-ident_hash="5ff3b685"><img src="https://res.cloudinary.com/fridaydigital/image/private/t_article_image/wpmedia/2023/12/0fb8bb9b7da0d47346a268f5b489fddf.jpg" alt=""></a><figcaption id="caption-attachment-349900" class="wp-caption-text"> Investment should be made in a stable environment and in a normal financial market,&#8221; says Mr. Ogiwara. The current Japanese stock market is &#8220;very distorted,&#8221; he points out (PHOTO: Kyodo News).</figcaption></figure>
<p> Mr. Ogiwara wonders if the current world situation and politics have become so uncertain and unstable that &#8220;it is not the right situation to invest.</p>
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<p> For example, the war in Ukraine has become a quagmire. The conflict between Israel and the Palestinians has led to the Houthis, a rebel group in Yemen in the southern Arabian Peninsula, attacking merchant ships that they consider pro-Israel in the Red Sea, which leads to the Suez Canal, and there are concerns about the impact on international logistics. Turning to Japanese politics, the government&#8217;s approval rating is declining and the outlook is becoming increasingly uncertain.</p>
<p> Many ordinary people are in debt rather than investing, and Mr. Ogiwara says, &#8220;It is better to pay off debts first. He is particularly concerned about the working-age population, who have housing, education, and other loans.</p>
<div data-friday-nextpage-lead=" Will &#39;24 be a difficult year for investment decisions?"></div>
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<h3><span class="strongInContent">U.S. Economy Slows, Japan&#8217;s Real Wages Negative&#8230;&#8217;24</span><span class="strongInContent"> Difficult to make investment decisions in 2012</span><span class="strongInContent"> A Year of Difficult Investment Decisions</span></h3>
<p> What will happen to the domestic and international economies in 2012? According to economist Sakai, the world economy will be driven by the U.S. and China, with China&#8217;s economy undergoing a prolonged adjustment due to the bursting of its real estate bubble. As for the U.S. on the other hand, Sakai sees the following. <span class="strongInContent"> </span></p>
<p><span class="strongInContent"> &#8221;24</span><span class="strongInContent"> In the first half of 2012, the U.S. economy will slow down, which will be negative for stock prices, but after that, a policy rate cut is in sight, which may be positive for stock prices,&#8221; says Mr. Sakai.</span></p>
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<p> In the U.S., consumption is slowing and inflation is also slowing. The labor shortage is also a supply-side constraint that is being resolved as women and immigrants enter the labor market.</p>
<p> What will happen to Japan&#8217;s economy? He said that the government strongly expects companies to raise wages in the &#8217;24 Spring Struggle, which could be higher than the previous year&#8217;s increase.</p>
<p> Sakai points out that there is a worsening labor shortage, strong corporate earnings, especially in export industries, and a social atmosphere that seems to compel companies to raise wages. He believes that the BOJ may lift the &#8220;negative interest rate&#8221; on some deposits made by financial institutions with the BOJ at the same time it confirms the status of wage increases in the spring labor struggle.</p>
<figure id="attachment_349901" aria-describedby="caption-attachment-349901" style="width: 1024px" class="wp-caption alignnone"><a href="#" data-ident_hash="cd0be1b4"><img src="https://res.cloudinary.com/fridaydigital/image/private/t_article_image/wpmedia/2023/12/6c1a0683093ef6293d9a70cc333b2283.jpg" alt=""></a><figcaption id="caption-attachment-349901" class="wp-caption-text"> At its December 19 monetary policy meeting, the BOJ unanimously decided to maintain its current large-scale monetary easing measures, which keep interest rates at extremely low levels. Low interest rates will support the economy and boost wage increases in the &#8217;24 spring labor struggle (PHOTO: Kyodo News)</figcaption></figure>
<p> Meanwhile, Japan&#8217;s gross domestic product (GDP) has been negative in the July-September period due to sluggish consumer spending.</p>
<p> Sakai says, &#8220;The real economy is weak. Real wages, after subtracting price hikes, have remained negative, and he expects real wages to turn positive only in the second half of 2012.</p>
<p> Based on this view, Sakai expects the Japanese stock market to decline in the first half of 2012 and recover in the second half.</p>
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<p> Sakai&#8217;s view on the timing of the general public starting to invest at this time is as follows: &#8220;Japanese people generally do not invest in the financial sector.</p>
<p><span class="strongInContent"> I wonder if Japanese people in general have sufficient financial literacy (knowledge and judgment). Unlike in the U.S., financial literacy is probably low.</span></p>
<p><span class="strongInContent"> The new NISA</span><span class="strongInContent"> is an opportunity for people to invest, but they need to access information on their own and make sound judgments about the economic environment, financial policies, and the risks of exchange rate fluctuations,&#8221; said Mr. Ogiwara.</span></p>
<p> Mr. Ogiwara also points out that &#8220;the government has not done enough to educate people about investment,&#8221; and has only encouraged people to save money.</p>
<p> It is not a bad thing for those who can afford to invest. Investing is one&#8217;s own responsibility, and not all good deals come to those who invest. Knowledge and good judgment are necessary, and the timing of investment is also important. If you want to invest, you should study and gather information and judge the timing of your investment, rather than just focusing on the start of the new NISA.</p>
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<p><span class="strongInContent"><span class="strongInContent"> Hiroko Ogihara </span></span><span class="strongInContent"><span class="strongInContent">Hiroko</span></span> Ogiwara is an <span class="strongInContent">economic</span> journalist born in Nagano Prefecture in 1954. After graduating from university, she worked at an economic office before setting up her own business. Since then, she has worked as an economic journalist. As a pioneer in household economics, she is a leading expert in explaining how the economy works in a simple way that is rooted in daily life.</p>
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 Hideki Asai

 If you are a professional investor, you always think about what kind of investment you should make regardless of the economy or the investment environment. On the other hand, is now the right time for the average person with limited economic and investment knowledge to invest?

Don’t be fooled by the new NISA… “Ordinary people should pay off their debts first,” explains an economic journalist.

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