Japanese Auto Sales Surge

We noted here that the plunge in the paper price of gold (and silver) had prompted considerable renewed demand for physical and now it seems the scramble among the "more stable investor base" is increasing.

A few comments:• Obviously the Japanese supply chain disruption impacted auto sales significantly in May. This has also negatively impacted manufacturing overall, and at least partially explains why the ISM manufacturing index was down sharply in May. The ISM employment index was still fairly strong, suggesting many manufacturers view this as a short term issue.

Automakers in China are bracing for another year of tepid single-digit growth in 2013, weighed down by sluggish demand for Japanese cars amid a diplomatic row between the two regional neighbors and government measures intended to restrict traffic in bigger cities.

US and other auto manufacturers banking on increased car sales in China for 2012 have three reasons to be concerned. Blistering growth in Chinese auto sales is expected to plunge China is taking efforts to dampen foreign investment in autos Trade wars The Wall Street Journal reports

Ford, General Motors, Toyota , and Honda each experienced December sales declines of more than 30 percent, but it wasn't for a lack of trying.

It is becoming increasingly evident that Japan is attempting to use monetary policy to paper over the cracks of imploding foreign policy decisions. The 'storm in a teacup' that has brought China and Japan into fierce rhetorical battles over the Senkaku (or Diaoyu) Islands is having far more deep-seated impacts on the people of the two nations - and implicitly their buying habits. Unfortunately for the embattled Japanese - they are the ones in need far more than vice versa.

Cars sold at about the same rate in August in the U.S. as they did in July, analysts say. GM says its sales were up 18% year over year as Japanese makers struggled with continued supply problems caused by the March earthquake.Domestic carmakers fared better than many import brands in the U.S.

Toyota said it had agreed to pay about $1.1 billion to settle a class action lawsuit launched by US vehicle owners affected by a series of mass recalls from the Japanese automaker. Toyota did not accept any blame but agreed to compensate owners who argued that the value of about 16.3 million vehicles took a hit from dozens of deadly accidents allegedly caused by Toyota vehicles speeding out of control in 2009.