Hitting Household Budgets

At a frightening pace, a wave of price increases is sweeping across Japan. Crude oil prices, which hovered around $50 a barrel at the start of 2007, roughly doubled by year's end. Who could have predicted such a surge?

Regular gasoline is now routinely priced above ¥150 per liter, and diesel and kerosene have seen even more dramatic increases, leaving household budgets in a state of anxiety. Taxi fares, groceries, beer – the price hikes continue all around us.

The Unusual Nature of This Price Hike

We want you to recognize that the current price increases are an unusual phenomenon, unlike anything seen before.
Generally speaking, or theoretically, price increases are typically triggered by a rise in personal consumption, meaning increased demand.

However, this time is entirely different from typical price hikes, driven by significant increases in crude oil prices and rising costs for grains like wheat and soybeans. One might call it 'malicious price inflation'.

Troublingly, the rise in oil and grain prices is a global trend and is expected to continue its upward trajectory. Be prepared to adapt to these persistently high prices. It's time to abandon simplistic financial planning.