[Seamus Warren]

An acquaintance sent me this message and I was wondering if anyone had anything to say on this topic (the Japanese economy) and/or if anyone could maybe point me to an egghead/ivory tower/beard stroker/intellectual/student forum that might discuss this sort of thing. Thank you.

How are you? Haven't heard from you in a while...I don't get any e-mails anymore! Maybe it's because you don't have my new address...i love all of your e-mails so please...cc them to me!

Things are great here. I am almost finished school. I only have one paper to go...of course it's a big paper and I have been too lazy to start it...it's about the Japanese economy. 50 pages....have any comments on that particular subject? I wonder what your view is on Japan besides sumo wrestlers and sushi...

If you ever want to visit, please come! We have two appartments here and so we have more than enough space. My brother actually went to France now and is studying to become a french chef...I know that as mentioned below, it isn't a particularly cool time to be in France, but I guess he is pursuing his dreams and that's great.

K, I look forward in hearing from you.

Regards,...

[Siberian Fox]

They're screwed, I think is the succinct version.

They got themselves stuck in a situation of deflation and eternal recession and last time I heard nobody could figure a way out of it.

Japan got hit like everyone else in the 1990s, but what makes their case special is that when their central bank played it by the book, cutting interest rates slowly so as to encourage spending but not stoke up inflation, it didn't work. Instead what Japanese people did was save all their money, thus making the situation worse, so rates were cut agian and again and again until... they were zero. At that point they were toatally buggered, since they had cut rates as far as they could go and they were still in recession. I think out of desperation the Japanese govenrmetn borrowed a load of money and tried spending the country out of recession.

I don't know a lot about the Japanese economy but I think that is the basics of what happened to them.

[AnotherDeadHero]

Did the Japanese government not give all its citizens something like $500 to freely spend in an effort to boost their failing economy?. The majority of the recipients just saved the money though, for the reasons Fox just stated, making things worse.

[Il Porko]

The reason that Japanese peopel save so much moeny is that they are getting older. The Japanese govt restricted immigration for years and years. Immigration is the main reason populaitons grow, so.... no immigration, no growth.

No population growth leads to a country with lots of old people and too few people of working age. These people pay higher taxes to pay for pensions, and older people spend less because they are worried about the economy. The younger people spend less because their wages are going as taxes to the older people, who are saving the money because they are worried about the eocnomy.

The banks then loaned moeny like it was going out of fashion. Loads and loads of money. All these laons and pensions related to stock markets, which crashed in 1997. Since then, Japan's banks are in debt to their eyeballs.

The govt could spend moeny on roads and bridges but this requires slack in the economy, ie unemployed peopel to take up jobs, companies to benefit from the new roads and infrastructure by building in new areas, and a market to buy all these new goods. The companies don't have the money, and the people won't spend it.

The banks could loan money to tide the companies by until things got better, except that the banks are already up shit creek in that regard. The govt could fund these loands, except that the govt can't pay it's debts because it pays them from taxes. taxes are down ebcause the economy is in recession.

Not a good place to be