Double Whammy

As anybody investing in stocks knows the market is pretty expensive right now.  Almost anything that I bought a year ago is up ten to twenty percent!  The market has recovered all of its value that it lost in the crash of 2008 and I'm not sure if it is showing any signs of slowing down.  Of course this makes things like the value of my portfolio look nice but in reality it's not the game that I want to be playing.  Not that it's impossible, but it is certainly more difficult to find value in this market.

Another problem that effects us expats is the exchange rate.  As any expate living abroad and sending money home is aware the exchange rate is like an extra hoop you have to bring into the equation.  For expats it's having to line up two scopes before we can pull the trigger on a deal. 

In the last two or three years living in Japan has been great!  The Japanese yen grew to new heights that had never been seen.  Of course this was not good for Japanese businesses as their products were now more expensive and exports fell.  But for us expats using yen to buy US dollars it was a breath of fresh air.  I never thought I'd ever see the day when 75 yen would buy me 1 US dollar.  Those were the days I lived in for the last three or so years.  It was like everything was 25% off including stocks, plane tickets, and gadgets.

This is not the story as of late.  Due to a change in the Japanese government, renewed consumer confidence, and an aggressive stimulus plan the yen has taveled back to being on par with the US dollar.  This means a big change for me and my salary. 

I did my best to abstain from squandering my money on frivilous items and focused on putting everything I could into stocks even during the days of a strong yen.  But I also developed an expectation of how much I could buy with my yen.  For an example let's say I was making $60,000 US dollars last year.  I did my best to save and invest and mangaged to achieve an almost %50 savings rate.  Now my salary has fallen to almost $45,000 a year.  If I continue at the same spending rate as last year my savings rate will fall to almost 33%.  Of course this isn't a complete apples to apples comparison but the point is my yen will no longer buy me the huge number of shares that it used to.

This has led me to a cross roads where I have to make a few important decisions.  Do I pick up another job and try to earn more?  Do I continue to invest in US dividend growth stocks?  Do I change my focus to the Japan domestic  market?  Where can I reduce expenses more?

Honestly I haven't made a decision yet concerning any of these.  Any other expats out there what's your take on the situation?