Japan pays about 2,000 yen for each ton of iron ore it imports. Sheet iron made from the ore sells for 50,000 yen a ton and automobiles built with the sheet iron sell for 1 million yen a ton. The Japanese economy thrives by creating added value in the manufacturing of industrial products from raw materials.
I explained this to Japanese television station staffers who visited me recently for an interview, but they knew little about the system. They preferred to discuss the Japanese recession.
Japanese economic news today concerns mostly banking. The Japanese economy, however, derives its strength from the manufacturing industry, which creates added value of 125 trillion yen annually. The banking industry, worth only 25 trillion yen, plays only a supporting role to the manufacturing industry. The banking industry is saddled with bad-loan burdens.