| papflesje said: @ dbot: could you answer my question too, because I'm not getting this at all... |
I think that Sony is betting that the yen will eventually fall in which case they would actually benefit from the currency exchange. Factories cost a lot of money and their return is realized over many years. The yen problem should be a relatively short term issue.
The yen's gains have been primarily due to the fact that the Japanese economy and financial system is seen as being in much better shape than the rest of the world. In the past investors would buy the cheaper yen and invest it in other countries which would drive down the yen even further. Since the other economies are shaky at best, investors are buying and holding the yen. Long term, the yen will correct itself. 75% of Japan's economy is exports, they cannot allow their yen to appreciate against other currencies.
Thanks for the input, Jeff.
