Weak yen woes

[Shannon Spears]

Hello everyone,

It's been a while since I checked in here, but I was wondering how other US-based translators are coping with the weak yen? Based on the monetary policy trends in Japan, it seems like it could get even worse from here, maybe even dropping as low as 200, which would have me effectively earning less than half the rate I did when I started my career just 10 years ago.

I'm thinking of looking for more US and European clients, as currently 90% of my base is in Japan. Or maybe it's time to get into another business? I love my job but it's really disheartening to watch my earnings fall so hard due to macro-level events out of my control!

Shannon Spears

[Warren Smith]

I feel your pain!

 

Unfortunately it's not quite so simple -- the weak yen is likely driving work away from dollar- and Euro-based translators to yen-based translators. (At least, that is what has happened in the past...)

 

Warren

 

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[Nora Stevens Heath]

I had the opportunity recently to sign on with a new client, based in Japan. When they asked me what my rates were, I did a bunch of math to make sure I was charging them in yen what I'm used to making in USD, and explained my rates were higher at the moment because of the weak yen. Thankfully, they understood and accepted those rates; in fact, they had lost a couple of assignments because the projects simply didn't have the budget for their U.S.-based translators.

I wouldn't mind adjusting those rates back down a tad if the yen grows significantly stronger. On the other hand, I'm visiting Japan in December for the first time since 2019, and the traveler in me kind of hopes the yen stays weak for juuust a little longer.

(I have one Japan-based client whose rates I have not adjusted. They're a very small company and we get along very well on regular jobs that keep me interested and engaged; I'm happy where we are in our relationship and don't feel I need to negotiate with them for higher rates. Another nominally Japan-based client has always paid me in USD, and the rest of my clients are U.S.-based, so I don't feel tons of pressure to pester this one outlier. If you're worried about putting all your work in one weak-yen basket, you might feel better with a geographically diversified client base.)

Nora

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Nora Stevens Heath <no...@fumizuki.com>
J-E translations: http://www.fumizuki.com/

[Warren Smith]

Interesting -- when compared with 11 years ago, the dollar buys twice as many yen. Cumulative inflation in Japan since 2011 totals 7.5%.

https://www.in2013dollars.com/japan/inflation

 

Seems like a good time to visit. Is the country open for tourism (or are there still COVID restrictions)?

 

W

 

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From: hon...@googlegroups.com [mailto:hon...@googlegroups.com] On Behalf Of Shannon Spears
Sent: Thursday, October 20, 2022 4:30 PM
To: hon...@googlegroups.com
Subject: Weak yen woes

 

Hello everyone,

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[BTB]

I think all US freelance translators are suffering from the weak yen. For the time being, I'm coping by reverting back to a pandemic lifestyle (no eating out, no travel for fun, not even a latte at Starbucks, etc.) and going to local food pantries once every two weeks. If you are on Obamacare, log into the sign-up website and re-enter your projected income for 2022 (and when you apply for 2023 health insurance). You might qualify for (more) Federal assistance. I reached out to all of my Japan-based clients, basically asking for a lifeline (for all US-based freelance translators). About half said they will discuss with higher ups and get back to me, but I highly doubt they will come through with substantive help in time. I opened a yen currency deposit account at Union Bank this month. My end-all strategy is to have most clients wire yen into this yen account while I spend down my USD savings. If the yen strengthens, I convert the yen to dollars. If the yen stays at 30-year weakness well into 2023, I move back to Japan and use this yen for initial moving costs (I'm not tied down to a mortgage). Unfortunately I think the weak yen is here to stay - the difference between interest rates in Japan and the US is apparently the driving force behind the weak yen. As long as BoJ Governor Kuroda (term ends in April 2023) keeps interest rates extremely low in Japan, and the US Fed continues to raise interest rates in the US, the yen will get weaker. Once the Fed hits terminal rate (stops raising), the yen might stabilize and start to strengthen again. However, I have read some projections that the yen is unlikely to rapidly reverse course, and might stay above 125 until 2025 at the earliest. With that said, nobody can make an accurate prediction that far into the future. 

Brian Boland

[Dan Lucas]

Brian, if the situation is bad enough that you're using food banks, couldn't you / shouldn't you retrain or try something else? I'm not goading you, just wondering if it makes sense to continue the way you are. The US has been the fastest-growing major economy for years, so I'd imagine that for an intelligent person with business and financial skills there would be better-paying jobs around. Of course, location plays a part, but if you're not tied down with a mortgage then presumably you can move around the US.

On forex, I invoice my Japanese clients in yen, so I have to swallow the exchange rate risk myself. On the other hand the stability of yen-based pricing makes me easier to hire when my peers charge in dollars or pounds. I suspect it more or less evens out in the end, over the long term.

Unlike Shannon and Warren I don't do medical or patents, but underlying demand for financial translation has been solid over the past couple of years and I'm not seeing any obvious signs of a slowdown as yet. I expect a recession and for things to get worse over the next twelve months, though. In that scenario, dollar strength might well continue due to its status as a safe-haven currency. Worrying.

Dan Lucas

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[Geoffrey Trousselot]

Forgive me for just posting with no expertise on the matter, but I am continually hearing statements such as "The US economy is experiencing inflation but other countries have been hit harder" and meanwhile, I really don't feel being hit hard. Perhaps because I am at an age where it is easier to earn a living, but the rise in the cost of living seems to be entirely due to the devaluation of the yen. Basically, I think the financial system is broken.

For example, Peter Berezin, Chief Global Strategist and Director of Research, Formerly with Goldman Sachs & IMF says on Twitter on October 18th:
"The US dollar is extremely overvalued. Interest rate differentials have moved against the dollar since August, suggesting that much of the dollar’s recent appreciation has been fuelled by technical forces and rising geopolitical risk outside the US."

Does extremely overvalued mean an impending correction? You would think that there must be an inherent economic advantage somewhere that will lead to a correction. Anyway, it must be anxious times. 

Geoffrey Trousselot

[Jeff Slenker]

Brian, here is something that will take you off of food stamps... 

https://www.indeed.com/viewjob?jk=f89646aceca6b249&q=translator&l=Huntsville&tk=1gfoj60r2nagg800&from=ja&advn=6111343572945211&adid=344205562&ad=-6NYlbfkN0D6qFSVCaa8tXn-rJ3OcXif2lPyFmwsE2iZBGE4YLg1gxd05zppvJMNFf91n--WkLyQgXtI203ZAYBXxWt-b0-5FWYdWidpAxOYhceALvsK6X-Q2ug36BNFuJWe7mc2aSmjhb_arl5or6jp1ksmE7AISnD9jWjdh9UGRggf6vmyxKiwhapuAqPqcs5xgqawlTuIXo84d9tMwrorC27G8WNr7SdpIIZ5nxizY-oeHyFWi5Psp-wETvKNDoBIU1pUp42bwR2Rv5Bx_yeDGDeLDcU7SnDMra-JuNyOCA0kghWsepWuQY7tE8ESQCEKCtQYfzHIwvKmCt6YvN_naYoKotgP-GW-oNtLxxzVNN7hXISHDMgMAaYN1sjN&sjdu=9nrDNPdV1DghkDNnC2WJlW1nrk21-asFvjSk9jx-s_OGMnXC8_RNWhee1t3qBzCoO0BAdvyrQ8pdV4-atl86KlQubrc0qpYGZgyepfRyeopAmAeSdROOZifoi0X7PLnrhn_M670yr6sMelM8Uh1YBXNz8UqCUywWcnk5DYA-7RrNeI_PE0BgD1z3pkBNGdhnzsInYdTg_JofgzsG5AzIpywfPW22jztMa8nkBtm4copkJmu-jays0f3DT_VfzjMosF1imEczvXltufRazAu3FYjKFZ0MU1eAsoCFv35zIP2YZkJWHUl_COZDgRqg7ubbRudOp-gvoD7PUzqwnIkAiK9S3tlxRJoQxyNeuEdaa2rYMMr3IW1MgphrlTfn9ByhP4k5F8oYRUeYK5n905OufL3r7D4VRhvB5xpCHQeTvPkzgu0odNKPrX5uZkRgp-immdmM4fI5VGY9aMn5aQIxJpjGhcQYPIYuZTjsdf218WPllOgsMBAJe9EkNp57MCMSeFC3rHI7vipel8kheRlLmOaBKAzFHFMlnPzBGWkS7cY3Zfwa0P0MwoI4tBN63ZfjILlo-33orXGatW0jwfe2GWcyz0Zgho8iDZScMFKNFQ6Ds9gJZq_FcEdyNwAQ2d6CyboKx_CdWC640YFNOjuIeOu4H9z0YvCEYRFyXjxUxLJ33GhmFPmvi0TN1zjFpg9MNDZv0iXfX1kgLDBUip1yGw&acatk=1gfvtl5kmi38g800&alid=5d98c461603ae743984476f5&pub=0cace3277f6b99df&xkcb=SoCC-_M3Y4uWkH6o350LbzkdCdPP&utm_campaign=job_alerts&utm_medium=email&utm_source=jobseeker_emails 

The pay is not bad for this area of the US...

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Jeff Slenker
J>E
Huntsville, AL USA
My web page is here (click on triple horizontal bars in upper-left corner for more pages)

[Rene]

On Sat, Oct 22, 2022 at 5:25 PM Geoffrey Trousselot <geoff.tr...@gmail.com> wrote:

Does extremely overvalued mean an impending correction? You would think that there must be an inherent economic advantage somewhere that will lead to a correction. Anyway, it must be anxious times. 

Geoffrey Trousselot

It is politics. Fundamentally, the dollar has maintained its value because of the Petrodollar system. Without that, it would be junk money. Now that neocons/neolibs have picked a fight with major OPEC nations, there is a very real chance that the Petrodollar is finally finished.

On the other hand, every time there are big wars, people flee into the dollar, which props it up.

Then again, if the current cabale of warmongers really get us into a nuclear WW3, all bets are off. Then you have other worries than exchange rates.

In short, whatever your Goldman Sachs guy says, everything depends on context.

Rene von Rentzell

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[BTB]

Jeff,

I'm not on food stamps. I should have explained our local food pantry, and been less melodramatic. Basically, the city has a budget for buying cheap food (or receives it for free) from farmers / stores that is close to its expiration date, and will probably be thrown away within a week. Everyone in the community is encouraged to pick up this free food before it goes bad. 

Dan,

I emailed you privately.

In a nutshell, the weak yen is a once-in-30-year disaster. Either wait it out in the disaster zone (US) or move to a safe haven (Japan). 

Regards,

Brian Boland

[BTB]

Hi all,

Just a quick update on the weak yen topic - I ended up moving to Japan in June 2023. No regrets, despite the stress of getting a visa, the international move, getting new contracts signed with clients, etc. I'm still thinking in USD, so prices here in Japan seem 20-30% cheaper. 

The interest rate differential between the US and Japan looks likely to continue driving yen depreciation. The Fed is leaning toward "higher for longer" interest rates, and the BoJ appears to have painted itself into a corner with low/negative interest rates (unlikely to raise interest rates until there is solid evidence of a sustained increase in wages / inflation).   

I wonder how many other freelance translators are considering a move to Japan? 

Brian Boland

California > Yokohama 

[Dan Lucas]

Brian, always good to see a thread get updated, thank you for this.

When we chatted at the time it did sound like you were heading in that direction.

Very glad to hear that it's worked out for you. Must be a welcome and stimulating change after, what was it, nearly two decades in the US? I would think it's also lovely for your partner to be back in her home country.

Frankly, I suspect only a very small subset of JA-EN freelancers would consider moving solely on the back of forex movements. For many people, their lives have too many moving parts to allow such nimble footwork.

I'd certainly like to live in Japan again at some point, but it's not going to happen any time soon.

My mother is in her eighties and I couldn't leave her to live on the other side of the world at this stage of her life. I also have two kids who won't finish secondary school for another four years, probably with tertiary education after that. They wouldn't survive a state school in Japan, and I couldn't afford to send them to a private school.

Then, while I realise that not everybody owns real estate, there's the whole issue of what one does with the house (and dog!) while one is in Japan for five years or so. Finally, if I didn't like where I lived I'd no doubt feel differently, but my home is in a quiet, safe, and pleasant part of the world and I'm happy where I am.

Set against all that, the economic impact of yen depreciation is small stuff.

But everybody's circumstances are different. For some people forex could well be the straw that breaks the camel's back and makes a move worthwhile. I guess you're one of them, and I applaud you wholeheartedly for following through so decisively.

You in Tokyo or some regional city?

Regards,

Dan Lucas

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