Interesting piece in Salon about how Japan has defied pessimists for 20 years:
But at least so far, the consensus is that this dire scenario won't, can't, happen. Indeed, it's often said that you aren't a real macro trader (someone who bets on global trends) until you've gotten burned shorting (i.e., betting against) Japan. "You'll find 10,000 people saying I'm an idiot and that people have been saying this, and been wrong, for 15 years, and kid, shut up," laughs my source. The Bank of Japan says the economy is improving; analysts say the government has lots of options, including raising the value-added tax or having the banking system put even more assets into government bonds. (Already, the Bank of Japan is engaged in its own form of "quantitative easing," or purchasing government bonds, which, just as in the United States, is supposed to help the economy recover.) Japan's relatively healthy corporate sector could take over from households in investing its surplus cash into government bonds. "Everyone acknowledges the long term seriousness of Japan's fiscal position," writes Grice. "But people seem almost fatigued with the idea that a country which has defied bond market logic for so long now is ever going to change."
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