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Can you elaborate a bit on the part between Softbank spending on India's uber drivers resulting in an increase of Japanese exports? Is it just that there is a d

Can you elaborate a bit on the part between Softbank spending on India's uber drivers resulting in an increase of Japanese exports? Is it just that there is a desire for Japanese products in India, but not enough cash?

vmurthy 7y ago
Not OP but here's one way: Softbank invests in Uber India pushing up automobile demand[1]. Indian drivers buy cars manufactured by Maruti Suzuki (54% market share [2]). Maruti Suzuki is a JV between an Indian company (Maruti) and Suzuki (Japan) where-in Maruti pays 6% of sales as royalty for design and other facilities. In addition, you have to realize that Japan exports $35b of auto parts and $101b of automobiles [4]. So any lever which pushes up sales of automobiles in any nation is bound to have an impact on exports. [1] https://economictimes.indiatimes.com/small-biz/startups/demand-from-uber-ola-driving-car-makers-sales/articleshow/56633234.cms?from=mdr https://economictimes.indiatimes.com/small-biz/startups/dema... [2] https://auto.economictimes.indiatimes.com/news/passenger-vehicle/cars/maruti-suzuki-regains-54-market-share-in-november/67047159 https://auto.economictimes.indiatimes.com/news/passenger-veh... [3] https://economictimes.indiatimes.com/markets/stocks/news/lower-royalty-payment-could-get-maruti-an-earnings-upgrade/articleshow/62660913.cms?from=mdr https://economictimes.indiatimes.com/markets/stocks/news/low... [4] https://oec.world/en/profile/country/jpn/ https://oec.world/en/profile/country/jpn/
- 5822130027 7y ago
  Exactly.
  - dzader 7y ago
    lol
- thrwo132123 7y ago
  +1 Indeed, one of the reasons for the current auto-slowdown in India appears to be the drastic decrease in benefits offered by Taxi aggregators, which is hitting taxi drivers hard. Can't complain, since taxis saturate the roads in Bengaluru already.
  - r_singh 7y ago
    > taxis saturate the roads in Bangalore already In Indiranagar (a popular, hip neighbourhood in Bangalore), you might have to wait for an hour to get an Uber or Ola, on weekday mornings too! Hence a lot of people are using Yulu (India's Bird).
    - vmurthy 7y ago
      Add HSR Layout to that list , too. I’ve started using a combination of Bounce( two wheeler point-to-point rental ) for <2km travel , public transport for longer distance travel and cabs as the last option.
- navigatesol 7y ago
  Okay, now where does all the demand for these Indian taxi services come from that are actually going to pay for all of these automobile imports? It's not like Uber demand is insatiable. The notion that investing in Uber is going to drive the auto industry (which is completely contrary to the mission of these transportation companies) is an odd one. I can see that, at the margins, a company can spend money where it thinks it it can receive complimentary benefits. But this idea that you can spend your way into riches is a fallacy. So, I think we agree on some things, mainly that Japan is printing money and Softbank is a beneficiary and is using that cash to spread around the tech industry. Cheap money. Except I think it will backfire, eventually.
  - 5822130027 7y ago
    Most of your understanding of how money operates is a legacy of the gold standard, ( A large part of neoclassic and austrian economics is ). Lets take some of your conclusions to its limits shall we ? and see how much predictive power it truely has. In 2008, why did the Fed print 4 trillion USD ? If we cannot spend our way to riches, surely the fed should have shut the liquidity taps ? If the Fed did stop the liquidity taps - it would have caused a second great depression like event, surely we cannot spend our way to being rich ? Many people in the 1930s would have agreed with you ! You could argue that "The fed has made the situation much worse and the chickens will come home to roost". I do not see any chickens 10 years in, do you ? in fact everything seems to prove the amount of money printing was not enough due to non-existant inflation and outright deflation. Lets go back in time to the 10th Century, to the origin of fiat currency - the emperor of china build the great wall, how did he pay for it ? well he just issued paper money to create new purchasing power which allowed him to build his wall. 1000 years in - we just sit back and admire how it was possible to build such an engineering marvel in ancient times. ------------------------------ The chinese have a much more sophisticated understanding of money ( they were the ones who invented it after all ) - and they are using it to build railways, cities, supply chains, .... 1000 years in hopefully we are not ruled by people who do not understand the role of money in a modern state or else we will be left wondering how china was able to pay for terraforming Mars and turn an entire new planet chinese.

vmurthy 7y ago

Not OP but here's one way: Softbank invests in Uber India pushing up automobile demand[1]. Indian drivers buy cars manufactured by Maruti Suzuki (54% market share [2]). Maruti Suzuki is a JV between an Indian company (Maruti) and Suzuki (Japan) where-in Maruti pays 6% of sales as royalty for design and other facilities. In addition, you have to realize that Japan exports $35b of auto parts and $101b of automobiles [4]. So any lever which pushes up sales of automobiles in any nation is bound to have an impact on exports. [1] https://economictimes.indiatimes.com/small-biz/startups/demand-from-uber-ola-driving-car-makers-sales/articleshow/56633234.cms?from=mdr https://economictimes.indiatimes.com/small-biz/startups/dema... [2] https://auto.economictimes.indiatimes.com/news/passenger-vehicle/cars/maruti-suzuki-regains-54-market-share-in-november/67047159 https://auto.economictimes.indiatimes.com/news/passenger-veh... [3] https://economictimes.indiatimes.com/markets/stocks/news/lower-royalty-payment-could-get-maruti-an-earnings-upgrade/articleshow/62660913.cms?from=mdr https://economictimes.indiatimes.com/markets/stocks/news/low... [4] https://oec.world/en/profile/country/jpn/ https://oec.world/en/profile/country/jpn/

5822130027 7y ago
Exactly.
- dzader 7y ago
  lol
thrwo132123 7y ago
+1 Indeed, one of the reasons for the current auto-slowdown in India appears to be the drastic decrease in benefits offered by Taxi aggregators, which is hitting taxi drivers hard. Can't complain, since taxis saturate the roads in Bengaluru already.
- r_singh 7y ago
  > taxis saturate the roads in Bangalore already In Indiranagar (a popular, hip neighbourhood in Bangalore), you might have to wait for an hour to get an Uber or Ola, on weekday mornings too! Hence a lot of people are using Yulu (India's Bird).
  - vmurthy 7y ago
    Add HSR Layout to that list , too. I’ve started using a combination of Bounce( two wheeler point-to-point rental ) for <2km travel , public transport for longer distance travel and cabs as the last option.
navigatesol 7y ago
Okay, now where does all the demand for these Indian taxi services come from that are actually going to pay for all of these automobile imports? It's not like Uber demand is insatiable. The notion that investing in Uber is going to drive the auto industry (which is completely contrary to the mission of these transportation companies) is an odd one. I can see that, at the margins, a company can spend money where it thinks it it can receive complimentary benefits. But this idea that you can spend your way into riches is a fallacy. So, I think we agree on some things, mainly that Japan is printing money and Softbank is a beneficiary and is using that cash to spread around the tech industry. Cheap money. Except I think it will backfire, eventually.
- 5822130027 7y ago
  Most of your understanding of how money operates is a legacy of the gold standard, ( A large part of neoclassic and austrian economics is ). Lets take some of your conclusions to its limits shall we ? and see how much predictive power it truely has. In 2008, why did the Fed print 4 trillion USD ? If we cannot spend our way to riches, surely the fed should have shut the liquidity taps ? If the Fed did stop the liquidity taps - it would have caused a second great depression like event, surely we cannot spend our way to being rich ? Many people in the 1930s would have agreed with you ! You could argue that "The fed has made the situation much worse and the chickens will come home to roost". I do not see any chickens 10 years in, do you ? in fact everything seems to prove the amount of money printing was not enough due to non-existant inflation and outright deflation. Lets go back in time to the 10th Century, to the origin of fiat currency - the emperor of china build the great wall, how did he pay for it ? well he just issued paper money to create new purchasing power which allowed him to build his wall. 1000 years in - we just sit back and admire how it was possible to build such an engineering marvel in ancient times. ------------------------------ The chinese have a much more sophisticated understanding of money ( they were the ones who invented it after all ) - and they are using it to build railways, cities, supply chains, .... 1000 years in hopefully we are not ruled by people who do not understand the role of money in a modern state or else we will be left wondering how china was able to pay for terraforming Mars and turn an entire new planet chinese.