Howard Lutnick and Ryosei Akazawa seated side by side
Howard Lutnick and Ryosei Akazawa’s awkward on-camera to-and-fro followed months of negotiations © Howard Lutnick/X
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There were several moments during Howard Lutnick and Ryosei Akazawa’s celebratory joint video statement last week where you wondered if Japan’s chief trade negotiator was speaking of his own free will.
“You . . . think about what was good for Japan. I really felt so . . . You are a very nice guy for me and also for the Japanese people and Japan,” said Akazawa, praising the successful conclusion of trade talks and beaming at the US commerce secretary as a hostage with Stockholm syndrome might. 
Other nations must learn and practise Akazawa’s exact expression: the great grimace of friendship with the US, version 2.0.
The awkward on-camera to-and-fro between the men followed months of negotiations which began with Japan, as America’s best friend in Asia, hoping it could secure zero tariffs before being made to feel grateful it was only hit with a 15 per cent levy. The glint of gaslight was in Lutnick’s eye when he described this unprecedented handicapping of free trade as “tremendously beneficial to Japan”.
But the real crux of the deal was Japan’s $550bn investment commitment to “advance economic and security interests in the US”. Japan has agreed to disburse this by January 19 2029 — notionally the final day of Donald Trump’s presidency. The import of the deal is immense, but the publicly available information on key elements is sparse. 
Such details as there are have been set out in a seven-page, grammatically faltering memorandum of understanding between the US and Japan — a document seen by the Financial Times but which US government officials, astonishingly, say is only available to a handful of people in both the state and commerce departments. Japan requested something in writing, and this is what the small cabal around Lutnick appears to have come up with. Japan is not releasing the memorandum until the US side does the same and, as one Tokyo-based official puts it, the mechanics of making it public have broken down.
The MOU sets out an arrangement which, on one reading, reeks of coercion: a sovereign nation forced to funnel private and public-sector investment to a much richer one under a structure unashamedly directed by the US president.
Once Japan recoups its investment, it then reaps only 10 per cent of the cash flows from the project, to America’s 90 per cent. Yes, Japan has nominal input via a consultative committee into which projects are chosen, but there are no Japanese on the more powerful investment committee and it’s Trump who makes the ultimate call. Yes, Japan can elect not to fund an investment, but if it does so the US may impose new tariffs on Japan “at the rate determined by the President”. 
Japan, tenuously, has ways to spin this as a win. It knows that Japanese companies want to invest in the US and that these investments will be compounded and guaranteed by its government-backed lenders. If that was the price of lower tariffs, it may as well be something that might have happened anyway. But a gloating Lutnick, appearing separately on CNBC, denied Japan even the right to make that case at home. Japan, he said, had sought to “buy down” its tariff rate with a deal that he described as “off the rails” and the most fun he had working for this president. Trump, he said, had “complete discretion” over Japan’s investments and would decide where and how he wanted Japanese capital spent in America.
Akazawa, back in Tokyo and without the constraint of sitting at Lutnick’s side, told reporters that, according to the terms of the memorandum, the “complete discretion” bit was wrong. We’ll see.
But the precise contents are arguably less momentous than the nature of the document itself. The point is that its one-sidedness, continued unpublished life in the shadows and the widely variable interpretations this allows represent a miserable charter of what it means to be friends with the US in 2025. At home, Trump is perfecting ways to circumvent Congress; in dealings with America’s allies, his people are also circumventing the normal channels. This MOU, in its invisibility and construction-by-cabal, is a useful blueprint of that process in the early stages.
Japan, thinking that the old rules of friendship applied and that it had handled Trump astutely in the past, entered negotiations imagining that the underlying deal was the intended destination. What it found was a counterpart using the language of dealmaking as cover for the complete retooling of amity in the service of individual aggrandisement.
Copyright The Financial Times Limited 2025. All rights reserved.

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Oafish mafia. Nutlick is as dumb as a door nail, if he thinks this really is a triumph, rather than a delayed own goal.
(Edited)
It's the gloating (for domestic US consumption of course) that really puts this over the edge. Otherwise you could call this brutal realpolitik. Even Putin doesn't gloat over his vanquished enemies. Disgusting...this is the US of old, although I suppose it's a slight improvement that instead of assassinating people they don't like, the US is using financial coercion.

On that note...it's really extraordinary...the world has become so addicted to economic growth, even the hint of a threat to that growth is enough to facilitate the most craven debasement amongst great civilisations like Europe, Japan, India...perhaps they rationalise it as the only real price will be humiliation, which is better than impoverishment.

Nonetheless, the only reason Mango Mussolini's trade policies are working at all is because the Americans seem a lot more willing than everybody else to accept the risk of real economic pain (I know some will say it's because they don't understand, but I think they do).
This is all so distasteful and disrespectful to Japan. I'm genuinely astonished at the tone-deafness and lack of tact from the current US administration. The world is watching. This will come back to bite the US.
But interestingly, the Japanese appear to be happy to take this on the chin. Either they completely lack any backbone or they have no intention of ever honouring this one-sided arrangement.
Presumably Japan is betting on the time taken by US government to issue the relevant visas as making the chance of investing anything in the US practically zero - otherwise the next Japanese government should just disown the deal as Trump would do if he doesn’t like a deal
Isn't the administration just throwing big numbers around with no concrete follow up, accountability or verification. Like Zuck checking with Trump on a hot mike what number he should give for META investment into the US, or Musk claiming that DOGE was going to save $2trn. Headline today, gone tomorrow. This is reality TV folks
The EU too gave in; reducing tariffs on US-goods entering the EU to 0% while agreeing a 15% import tax on EU-goods entering the US. It was foreseeable because the biggest economies in the world did not unite in a common response to the bully in the WH. He had the tariff-field all for himself.
"Split and divide"... and the other big economies did not have the balls to stay firmly together..... Game theory "prisoners dilemma", except this time they had the opportunity to agree on a common approach. I think the leaders of the other big economies failed this subject at the university....
Interesting. Japan has printed money recklessly (quantative easing), held interest rates criminally low and benefited massively from the FX differences to the US dollar. Hedge funds have also benefited. Massive imbalances. Plus Japan gets "free" security from the US navy from Russia and China. In business there are no "friends". The author of the above article is a "coffee table" journalist with "feelings are more important than facts" attitude. No matter who is President, the USA will be taking action otherwise the debt pile and devaluation of the dollar and massive inflation will gut the USA economy. This is not so much about Trump but about the US Treasury realising it needs to get a grip and get some money back from its WW2 "allies" and "former enemies". Germany is going to have to pay back a lot as well.
The US is the only country massively to have benefited from WW2. It was content to assume the resulting grandeur and still does so.
Thats the kind of contrived and ultimately st*%pid narrative that sooner or later will come back to bite the CCP and Putin and most of the rest of us too
If you win a war, you should assure that your enemy can save face or you will have a ongoing animosity between you an him.

Now Japan hasn't lost a war lately and, as far as I know, it wasn't considered an enemy.

To not let Japan save face is one of the biggest blunders that Trump made.
The Japanese, the Canadians and the fragmented EU etc should club together and tell Trump and his lackeys to take a hike.

It's complete extortion, I can't imagine the Japanese will follow through on this, it's completely humiliating and the Japanese don't take kindly to that sort of thing.
Isn't it too late? That should have been done a few months ago. Maybe the UK could have been persuaded to join the club?? But these things are tricky. In order to stand up to the bully Trump, you have to be 100% sure that your "friends" will take body blows for you. Most countries unfortunately focused only on themselves and likely did not want to incur extra wrath of the great Orange one but even having rumours of talks with other countries. Fear. That's how bullies usually win.
Yes, you are right.

It's very dispiriting, one would have thought that the collective brain power of those countries could have seen that sticking together was the one way to bring Trump to heel; instead, by caving in to him they have emboldened him.
Trump is perfecting ways to circumvent Congress
Sorry this is giving him far too much credit. Obama signing the JCPOA or the Paris Climate Accord and superficially committing the US in an ongoing fashion was far more of an end run around Congress far sooner.

Trump is not ostensibly committing the subsequent administration to anything, merely giving them an option they may choose to enforce or not.
The subsequent administration in Japan is very likely to pre-empt the "subsequent administration" in the US (if there is one). The current government in Japan may not survive the next few months, in part because of this act of grovelling that was demanded of Japan by the Trump regime.
There seems to be a great lack of understanding between the parties for a memorandum of understanding. It is probably just the usual legally void Trumpian photo-op.
Thanks Leo Lewis for a great article. The EU and Japan, the US’s most faithful allies have it seems received the very same treatment.
The US is wooing its enemies and abusing its friends. As they saying goes, It may be dangerous to be America's enemy, but to be America's friend is fatal. European and South East Asian "allies" of American must promptly de-risk from dependence on US weapons and fossil fuels.
Indeed. We see the great Orange one cozying up to Putin & delicately balancing limited measures against China.
Japan and EU bashing seems to be the new US fashion. Beware , they hold a very big chunk of outstanding US TBills . Usually it's a mistake to bite the hand that feeds you.
Thing is Europe or at least you are hamstrung by your inability to think beyond the righteous have-your-cake-and-eat-it. You want things to continue then you need to wake up and fine tune, or change
Lutnick seems completely oblivious to this fact. The flipside of the US trade deficit is their ability to fund their fiscal deficit with low borrowing cost. If major US buyers of debt such as Japan, Germany and France are thrown into economic decline, US debt refinancing will become a lot more expensive. India and China are already reducing their treasury holdings and switching to gold. It would be wise for US "allies" to do the same.
(Edited)
Maybe the purpose of current US policy is to reduce the structural and long term unsustainable level of debt? In other words, you are talking at cross purposes to US policy
Sure, that is indeed the stated goal. But the current US regime has fundamentally misunderstood the reasons for US "exceptionalism". And the aim to reduce debt in relation to GDP is counterproductive if your debt servicing cost increases and your growth stalls out (from import tax/"tariffs")
I imagine they do get that
Reading the Miran paper and Ron Vara/Navarros work leaves me very much in doubt. These "generals" are fighting a war based on maps from the 80s and think that they can somehow recreate the Plaza accord in the world of today. The world is "selling America" and that should tell you everything.
It is possible the president may pressurise some countries to convert loan as perpetuity loan with zero interest and might write them off as they will never be paid and no interest
Yes, likely. The problem for US is then that while they wipe out existing debt, they will also lose the source of funding for future debt. The moment this happens, is when the Renminbi becomes the new reserve currency, because it ain’t going to be crypto….
They have outlined this option, yes. But however you twist it, that would amount to a "technical default". Meaning US sovereign rating would go in the sh*tter. Meaning yields on US debt refinancing would skyrocket. Meaning an actual default.

The current administration is behaving like a bull in a porcelain shop while selling porcelain tokens and stableporcelain.
Soon Trump will be demanding a discount on these too. No wonder Starmer wants to keep Trump sweet. He won't be around forever.
A old and wise civilisation against a circus with a clown and jokers. No doubt who will win over the long term.
The Chinese communist party hasn't even celebrated 100 years in power, don't confuse the CCP with China. But that said, the US is an absolute clown show.
Unwise. As the more powerful nation you either destroy and subjugate a lesser nation or make them your friend. In both cases they won't bother you.

What is dangerous is humiliating them. See Germany and the Versailles treaty.

A lesson the US learned after WW2 and tried a different path with astounding success.

Now they're back at the disaster path of humiliating other nations. History teaches us no good will come from this.
Japan has an annual 60 billion surplus with the US. After WW1 the victors, led principally by France extorted intentionally ruinous reparations from Germany. After WW2, the US basically bankrolled Japanese and German reconstruction and supported this with deep open markets. China at the time went its own way and, like Russia, killed and starved to death millions of its own before accepting the offer of deep open US markets on preferential terms and literally unprecedented quantities of US capital. China the victim that is
The idea that German reparations after WW1 were economically ruinous is a fiction. They were significant economically, but were primarily politically unpalatable and embarrassing.

As a share of GDP annual obligations were 2–3% (which equated to about 10% of government spending). For comparison, after WW2 West Germany paid about 5% of GDP in Allied occupation costs and reparations for several years (15-20% of government spending).
Great article. I'd like to understand the nature of the Cashflows. Is Japan being coerced into essentially giving money to the USA and it retains just 10% of any returns? Can Japan sell the assets at some future time? Japan should now diversify away from exporting to the USA. And develop its own independent defence like France.
If you read the MOU, you can interpret that the Japan side assumes the investment would be basically in the form of a loan. Therefore, I think that Japan would be satisfied to receive interest and recover the principal. I guess even that could be risky. Also, as someone mentioned below, the Joint Statement and MOU can be viewed publicly on the web site of the Cabinet Secretariat.
Can’t be so. Otherwise the FT would have admitted it
Kind of a loan, yes, but with no collateral or guarantees, the money to be invested in projects that only MAYBE will pay off, and Japan left with the losses without consumate upside potential. It's basically extortion.
A scam. It's hard to imagine Japan will actually follow through with this blackmail.
What goes around comes around

America will pay for this in the future, but Strumpf wins today
The Bloomberg headline is:”Japan risks tariff hike if it shuns Trump investments”……isn’t this the classic definition of extortion?
Japan runs a 60 billion trade surplus with US and has done for decades
That is not extortion.
No but cumulatively it’s unsustainable, for Japan and the US
It is sustainable as long as everyone sticks to the unwritten rules. Trump has deliberately torn up those rules in the misguided belief that they worked to the disadvantage of the US. In the long run, the US will be the loser as a result of Trump. His attempted extortion will backfire.
Ah yes, the rules based order that but for Trump would still be with us. I think you are just fiddling whilst the tsunami approaches
It certainly isn't. You need to look at trade in the round not by individual country. That is not to say that discriminatory trade practices (hello China) should not be addressed. But that is different altogether.
That simply means the Japanese make better, more competitive products than Americans do.
(Edited)
Whatever, it’s unsustainable. And if so then what gives way and collapses eventually? Probably almost everything
(Edited)
And in a globalised world, everything likely means everything, everywhere
Why is it unsustainable?
Tariffs are a charge on goods Japan would sell in the future. It has no right or requirement to sell goods to the US going forward.

If you try to buy a car and the salesman tells you the price you have to pay, is he extorting you? When you finish selecting your groceries and approach the cashier, do you suddenly have the feeling you're being 'extorted'? When the prices increase at your local barbershop, do you shake your fist at the barber for his extortion racket?

What a charmed life you must lead that whatever you want should be given to you free of charge.
The great shakedown continues. That the payoff is once again in fairyland is irrelevant.
Say what you want about India but at least it’s maintained its sovereignty. China in its 5,000 year history has never invaded or occupied Japan or threatened to. That Japan was nuked twice and hosts bases from said nation should be a source of national frustration
Um ... you're not a historian, are you?!
The two Chinese invasions of Japan came in 1274 and 1281, both under the Mongol Yuan Dynasty. The failure was in part attributed to the winds of heaven, from which the world gained the word Kamikaze.
Are you really Chinese? Says something about the education system if you are
It threatened to And failed
Other countries became too dependent on the US market and US consumerism for their economic success. Now the price is being paid as Trump and his henchmen take hostages.
Define naivety or stupidity. Yep.
Eh… last time I looked, Japan has a trade surplus with the US of circa 60 billion. That is every 12 months, and over how many decades?
All voluntary on the part of consumers and investors
Indeed. Americans have perfected the art of living beyond their means in every sense. I doubt the regular US consumer is keen on Trumps "made in America" fantasy and pay more than double on everything from sneakers to electronics. This is what happens when you make an incompetent real estate nepo baby president.
Eh oui
There’s a global sickness going around which totally overvalues the US as a trading partner, or worse, any kind of reliable ally. Muppets like Lutnick need to be shown the door rather than capitulated to. If the world feels sick now it will be even worse if countries follow through on these agreements. They need to renege now.
Gradually they will renege, countries are simply buying time. As long as the US remains an outlier on tariffs, the US will gradually lose importance in global trade. More importantly, their ‘exorbitant privilege’ will disappear.
Nutlick is out of his depth and mistakens success in finance with diplomacy, Japan is vassal state of the U.S. but they will bide their time to diversify away.
Correct me if I am wrong, but this sounds like a bond investment by Japan and an equity investment by the US. Japan has a priority claim on cash flows until its bond is repaid and the US gets 90% of the subsequent cash flows. Fine for the US as long as the investment is profitable. That is the question.
It is tribute, buying access to markets by a payment to the great power. This time the old problem of passing costs to final consumers is avoided.
Is US putting up any capital?
Indeed. My reading is that Japan has no incentive to make the investment profitable, as long as it gets its money back.
Unfortunately for Japan it’s a junk bond, with a triple a yield
(Edited)
Obviously Trump sees the beneficial US-Japan partnership starting with some new hotels and golf courses, creating jobs... and infrastructure, roads/stations leading to 5* resorts.
If both sides are reaching an agreement where one is disgruntled it doesn’t bode well. You can’t screw over another country and expect them to be happy. I can’t see Japan upholding their part of the agreement, they would stall or find a way to evade it which I’m sure all other countries are considering.
The US is creating enemies out of friends.
Postpone as much as possible and then refuse to invest. Trump will soon be gone. In the long term, all countries should not rely on the USA anymore. No trade with the USA and no use of their weapons (see Qatar)
The US is in dire straits. The Japanese will stop buying US government debt. The ME "monarchies" will reduce weapons purchases since the US is completely beholden to the Netanyahoo regime. And Europe is moving to reduce its energy dependence by switching to renewables. Whatever the opportunity the US had to turn this around in 2024, they threw away buy electing "genius businessman" Trump.
You can see why Shigeru Ishiba doesn't want to the PM who signs the final deal.
(Edited)
How binding is a memorandum of understanding?

Japan has to convince companies that this is how to invest. Is it even doable.

Or is this deal just a method to give camp Trump a media win so they can move to next target for humiliation

The forced dishonesty won’t sit well with the Japanese psychi.
Hush money. That’s all it is. Maybe Japan will even get some of it back one day?
America has no friends, only interests!
Very interesting article coming from a Japanese owned newspaper.
Shameless extortion and self-dealing by Trump and his acolytes. Corruption at its most blatant.
You seem not to know the meaning of the words "extortion" or "corruption". Try a few more words, and your sure to accurately use one eventually... Blind squirrels and such.
"...You . . . think about what was good for Japan. I really felt so . . . You are a very nice guy for me and also for the Japanese people and Japan,”..
Disgraceful. I feel sorry for Japan. How low it has fallen?
Anyhow, Japan could offer to send 550 million guns to defend USA. USA could do with some more guns to protect itself. That could lower the tariffs to zero.
"Japan confronts the increased price of US friendship"
-------------
What the US offers has nothing to do with friendship. The US doesn't do friendship. As Kissinger is said to have commented, "It may be dangerous to be America's enemy, but to be America's friend is fatal."
The US is (all institutions of state) run by a bunch of deranged loonies at the behest of the Israelis. Why would anyone trust the US for anything anymore. The Americans are good people, they need to rise and drain the money in their politics, kick out AIPAC and overseas lobby groups and restore their democracy - and thereby standing in the world.
The lobbies will never allow democracy back in the USA
(Edited)
Exactly, the lobbyist's masters have already gerrymandered democracy to create a humongous voiceless disenfranchised of up to half of the adult population and with the democrats help.
Same in the UK
I guess you missed the article about Trump chewing out Bibi over the Qatar thing?
A well written article, thanks. I do wonder if Japan and Europe should be more aligned with China and India, using their market opportunities to keep those powers away from creating an anti western axis with Russia.
(Edited)
The art of the deal - throw away your strongest alliance in Asia (where your problems are coming from) in exchange for a piece of paper saying “We promise to pay you that money you demanded - honest… …we really will. ….And by the way… …we’ll never ever forget this.”
Am finding it very ironic that the one newspaper that has a majority of sensible rational readers , has more and more censorship in more and more topics in the FT, .
Yes, I also wanted to comment on the article about Ch4rli3 K1rk.
I would expect any comments on CK would have required so much oversight and sensoring that it was not viable to open. He was a very decisive character … the direction of politics does seem to be steering humanity into another cycle of the dark ages of repression (thinking of Ck not FT)
Guns do not kill, humans do.
NRA
Hardly censorship.
What are we calling it then ?
Not sure it's got a name. Censorship suggests youre not allowed to express your views. Yet here you are, not banned from the FTs digital real estate, but restricted to certain areas. Presumably the FT is simply trying to dial down the rancorous rhetoric in our fractious times. There are so many outlets for your views, many, many more than there used to be. You really haven't been censored.
AI can easily filter out undecent comments. The issue here is that the FT must take into account the sensibilities of important financial contributors. It is censorship in its purest form.
Deciding to effectively spend resources on writing instead having to monitor comments
(Edited)
The economist has no "comments" section at all. Be happy with a modest but still decent ventilation channel. And we all know what those endless discussions of fanatics on social networks brought us. Better to preserve a bit of balance and free air.
I'm interested in comments by experts in the field and these are often in contentious areas leading to comments barred.
(Edited)
Folks give up too easily.
I had a comment barred and when I inquired, was told that it breached FT's rules.
When I inquired as to what specifically was wrong, the comment was reinstated.
(Edited)
The FT has the right and freedom to publish in a free press as per the Human Rights Act 1998 - but that is bounded by libel, official secrets etc.

Censorship implies you are having rights curtailed. Do you think you have a right to post on a newspaper forum?

Or as you say you're Irish, the Irish constitution (doesn't apply in the UK of course) Article 40.6 protects "organs of public opinion" i.e radio, newspapers. But nothing about someone wanting to post on a forum on a financial newspaper.
Highly unlikely that Japan (or anyone else, whether corporate or sovereign) will deliver any of their promises induced by Trump’s blackmail. After nine months of Trump 2.0, it has become clear to any counterparty that the best strategy is to say whatever Trump and his cronies demand, allowing Trump a PR victory among those incapable of monitoring follow up, but then deliver nothing.
Subtlety is sophistication in Tokyo but not in Washington. Japanese should have know better how to deal with the Americans.
Nutlick may crow but there is no substance to Trump or his policies other than destruction. The Orange Man is eating himself from the inside out.
A complete and permanent break with the US is needed.

Japan should balance US pressure with overtures to Beijing, Europe and the UK should do the same and seek a security arrangement with Moscow that frees us from American political and military control of the continent
With Moscow??????
A security arrangement with the country that in two years has moved slower than a snail in its invasion of Ukraine? Their military is a global laughing stock.
After reading this, the pool of possible shooters should be made to include ex-allies paying tariffs
Would be a very big pool
This embarrassing idiot is the reason the LDP will lose the next election regardless of who they select October 4th. Nationalism is coming to Japan real soon....
I have sympathy with Japan. They are under duress.
We will find out in the coming months and years, whether or not Japan is a sovereign state.
The Japanese cowards are joining the European cowards. Seems like the only nation standing up to Trump and the US is China.
Err India? Russia ?
Brazil?
Russia is not standing up to Trump. Putin is giving orders to Trump.
India, let’s see.
Did India give reciprocal tariff to US? I don't think so
Many of India’s bound tariff rates on agricultural products are among the highest in the world, ranging from 100 percent to 300 percent. While many Indian applied tariff rates are lower (averaging 32.7 percent on agricultural goods), they still present a significant barrier to trade in agricultural goods and processed foods


The list goes on.
They are a poor nation. They need to protect themselves.
(Edited)
Good. India needs to protect employment in those sectors.
No but it's clearly not giving the US what it wants, specifically (i) not letting the US carve up its agricultural sector (ii) Not nominating Mango Mussolini for a Nobel prize (Pakistan said it did, so guess who got to come over to Washington DC??) and (iii) Rejecting Cadet Bonespur's assertion that he "stopped" the recent Indo-Pak conflict.

Fairly big things, really.
Canada?
(Edited)
The Europeans and Japanese are very sensibly buying themselves time to quietly move away from the Americans as they shoot themselves repeatedly in their own feet.
That may seem clever but even the appearance of capitulation will have a negative impact on the EU and Japan in future conflicts / negotiations.
Denmark?
Let's not pretend Japan is a sovereign country. It doesn't even own its airspace. It's worse than a colony
Easy now
The US is quickly becoming reviled and alone under Trump. In short order they have pushed away India, Europe has started shifting and Japan and Korea likewise will start moving away. When Trump demands action against China, US will be alone. World trade will circumvent US. The ultimate self- harm from ’the sharpest bulbs in the shed.’
‘Brightest bulb’ , ‘sharpest tool’
We know what was meant Longchest
This is what Trump and the US don't realise: You can win every negotiation but still lose overall. Trump will do various deals that look great for USA based on threats and coercion, but USA will lose out on thousands of other deals that quietly shift elsewhere when he's not looking. See, for example, Norway's investment in warships from the UK.
Given the current account deficit and the trade deficit specifically, it would be hard for the US to lose overall if total trade is reduced even in both directions. That's kind of the point.
You nail the most important point: World trade will circumvent US.
More foreign investment in the US may only deepen its trade deficit given America's propensity to consume.
It's not positive spin but Japan may have bought itself a window of time to find and open up new relationships and markets.
„The Lutnick Lap“

„But a gloating Lutnick, said, Japan had sought to “buy down” its tariff rate with a deal that he described as “off the rails” . . . .

Trump has “complete discretion” over Japan’s investments and would decide where and how he wanted Japanese capital spent in America. „


For a country that required two nuclear bombs to surrender to the Americans at the end of WW2 it is astonishing, no mind boggling, that Japan could cave so far, so fast. For the Japanase saving face is the highest value of society, so being depicted by Lutnick on public television as absolute suckers must not be going down well.

An MOU is not an agreement and presumably such a massive, carte Blanche give away requires voting procedures and formal approval.

Is this yet another mirage of the „Art of the Deal“ that puffs up and smoke ~ I CSL, it „The Lutnick Lap“ ~ announced, victory lap and alas, it never happens.
It’s just to buy time while the Japanese figure out how to ditch their “ally”.
The MOU is probably useless.
Japan will not comply with whatever is there, the same applying to the US.
Basically, Mr. Trump imposed a certain tariff level in exchange for a PR stunt.
The US can not be relied upon and the Japanese know that.
They are buying time until they find a way to improve their commercial and military situation.
I hope you’re right.
I think the incoming Japanese prime minister, who could well be a somewhat hard right nationalist, will sort Nutlick out.
Nutlick. Ha ha!
Buttlick, surely!
Oh you clever rascal. You rearranged someone's name into naughty words! You must be the coolest fifth grader in your school!
The text can be found as a link from Japan's cabinet secretariat here: https://www.cas.go.jp/jp/seisaku/tariff_measures/houmon/index_shinchaku.html
Shocking!
one day the USA will finish last
Coming quite soon actually
Well they just threw away their closest alliance in Asia in exchange for a piece of paper saying “we promise to invest $550bn - honest we will, promise.” I’d say the US is already last.
No requirement to trade with the US. Open access to US markets is not a divine right, and clearly hasn't been reciprocal for a long time. Friends don't mooch off their friends, which is what all these exporter nations have been doing. So the US is finally putting its foot down. The tariffs are set based on recent trade imbalances, not even the aggregate imbalances from the last few decades. Japan should be thankful that it got a few decades of mercantilism free of charge.
Looks like India got off lightly… this is what happens when you are colonised and literally have a foreign army controlling you
There was a reason for that; a little matter of history and war.
It’s clear that the home of consumption is closed unless the shopkeeper decides to pay the customer to buy his goods. Japan like China will have to increase consumption at home. The days of being an export only country are over. Asia needs to grow up and wear the big boys pants. They are not struggling nations at the bottom of the pile any more. They are mature economies.
”They are not struggling nations at the bottom of the pile any more. They are mature economies.”

Does ”They” include Japan and China????

Creating incentives for your friends to become your enemies does not make you safer.
The US disproportionately benefited from its post war order. Selling it up for some coastal resort properties (or whatever Trump's scam will be) is not going to be worth anything to the US
Correct Japan can’t continue to grow at expense of US. Pay to play Nippon
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Works if the customer has good credit. Given the budget trajectory and USD decline, that seems no longer the case.
Howie to Ryo: "How about a little nutlick to ease the pain?"
Not to worry, 'Takaichi the Ballbuster' will save the day. Just three more weeks to go.
Extortion, plain and simple. Tony Soprano would be proud.
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I would be interested in Leo’s analysis of Japanese public opinion. This is an obviously shameful deal - perhaps the most degrading yet. Similar treatment of India has seen nationalists laud Modi’s China trip - unthinkable a few months ago. After her own public humiliation at the hands of Trump, Von Der Leyden, in yesterday’s State of the European Union address, spoke more of diversification from the US than from China. It is a great pity that India, the EU, Japan, Canada, Mexico and the UK did not find the collective spine to stand up to Trump before now. But maybe - I hope - the abject results (political and economic) of appeasement will shake the political elites from their reflexive desire to preserve US ties at all costs.
Japanese public opinion is not very happy with the government and the LDP it comes from. But it is more due to price increases / inflation / cost of living and immigration (China & South East Asia) than the US-Japan deal which nobody seems to really care too much about. Surprisingly there is not much analysis and comments about it in the media.
Thank you.
Japanese understand they are vassals therefore having it written down seems reasonable.
It’s appeasement in the short term as old allies rework trade and politics away from America…. there are plenty of open doors to push on , which will eventually include Russia, as Europe realises the benefit of “normalising” relations with its truculent neighbour, in preference to being whipped around by America which no longer stands behind security guarantees anyway.
I think out of that lot, India has been the toughest against the US. Not retaliating but being very clear that it won't be taken for a ride.
Reparations didn't go too well in Germany. This sort of arm twisting if followed through will not go down well in Japan and could destabilise the government and country with unforeseeable consequences.
All it needs is one guy to decry the deal as extortion and an act of surrender, and start a Japan First movement.
The headline might as well read "Famous sushi restaurant confronts the increased price of mobster protection".
So, if Japan isn't the winner ........
… and the US isn’t the winner …
Make Brexit Britain’s deal look even better does it not ?
The pet dog got a better bone thrown at than the vassal. Always the case.
Japan has been too meak for too long. A bad deal was inevitable. what is America's bargain chip over Japan? Defence and consumption. On defence, Japan needs to rearm. On consumption, Japan needs to find new markets. It can do both by allying with it's Asian neighbours instead of the US.
New markets for consumption where again?
I am appalled by the United States as presently led. Trump has essentially reneged on 80 years of post-WW2 historical precedent with Japan (which was not all sweetness and light, but was perhaps never quite as bad as this).

Leo Lewis is spot on when he uses the term "coercion".
You haven't seen nothing yet. Wait until he makes Canada the 51st state!
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They will not relish what happens after they attempt to do so.
I’d like to see him try.
Surely appalled and disgusted?
It really is outrageous that the US is acting in what it perceives as its self interest. It should absolutely continue another 20 years of letting other countries expropriate its wealth through beggar they neighbor national policies.

There's a reason that it's often called Japan Inc. They were doing it before it was cool.
cannot spin its one-sided $550bn investment commitment to Trump’s America as a win

They can't? Looks like Japan is a far more honest society than many other places.
The gas lighting team will spin anything.
The other possibility is that the average Japanese are more discerning in matters of money at very large denominations. After all they are used to a lot more zeroes on the bill, in daily transactions.