Most Japanese words written in Katakana in magazines, newspapers, books and school textbooks are decided by some authorities including Japanese government or major newspaper company. So, if you write Katakana words by your own invention most Japanese can not understand. For example Los Angeles is written as ロサンゼルス. If you write ロシャンジェルス all Japanese who can not speak English don't understand.

>I'm asking this because my friend gets insulted every time I write an english word written in Katakana, so is it wrong? Is it your Japanese friend? What did you write, for example?

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