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Titus
Joined: 19 May 2012
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 Posted: Sat Oct 06, 2012 8:10 am Post subject: |
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| GENO123 wrote: |
| Titus wrote: |
Korea had a military dictator (see problems in India) a very energetic high IQ population, American engineering (nobody ever talks about engineering and development) and free and not reciprocated access to American markets.
Regarding Japan's "crony capitalism":
http://www.paecon.net/PAEReview/issue23/Locke23.htm
Everybody stop what you're doing and read the above. Japan is not "crony capitalist". It's not even capitalist. It is, forgive my bluntness, fascistic. And it works.
So I guess Chomsky is right. Korea didn't use free trade, didn't allow Goldman to rape the population, and so on. How's our system working out for us? |
Japan's economic system works?
Two lost decades and counting. There was once a time where SONY was the number one consumer electronics company in the world. How's that working out? Indeed Japan is even worse off now than it was when the article was written Japan is in terrible economic condition for now and beyond. |
A lost decade by what measure? Whose measure? Equity markets and housing prices? Japan's unemployment is low, inflation is low, incomes are up. They are ***better off*** after the "lost decades" than during the asset bubble of the previous decade. |
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GENO123
Joined: 28 Jan 2010
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| Posted: Sat Oct 06, 2012 6:48 pm Post subject: |
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| Titus wrote: |
| GENO123 wrote: |
| Titus wrote: |
Korea had a military dictator (see problems in India) a very energetic high IQ population, American engineering (nobody ever talks about engineering and development) and free and not reciprocated access to American markets.
Regarding Japan's "crony capitalism":
http://www.paecon.net/PAEReview/issue23/Locke23.htm
Everybody stop what you're doing and read the above. Japan is not "crony capitalist". It's not even capitalist. It is, forgive my bluntness, fascistic. And it works.
So I guess Chomsky is right. Korea didn't use free trade, didn't allow Goldman to rape the population, and so on. How's our system working out for us? |
Japan's economic system works?
Two lost decades and counting. There was once a time where SONY was the number one consumer electronics company in the world. How's that working out? Indeed Japan is even worse off now than it was when the article was written Japan is in terrible economic condition for now and beyond. |
A lost decade by what measure? Whose measure? Equity markets and housing prices? Japan's unemployment is low, inflation is low, incomes are up. They are ***better off*** after the "lost decades" than during the asset bubble of the previous decade. |
Question:
Which country is (far) more in debt compared to their GDP and has (far) more future debt compared to their GDP the US or Japan?
No Japan's economic system doesn't work and hasn't for about 20 years. |
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Titus
Joined: 19 May 2012
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| Posted: Sun Oct 07, 2012 6:31 am Post subject: |
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| Japan issues her own currency and the debt is almost entirely internally owned. The level of government debt is irrelevant. |
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GENO123
Joined: 28 Jan 2010
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| Posted: Sun Oct 07, 2012 7:59 am Post subject: |
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| The more you analyze Japan�s predicament the more you realize that there is no way out. They are trapped in a boundless morass of uncertainty. If they successfully weaken the Yen, why will foreign investors invest in their debt paying 1%? As the following chart clearly shows, Japan has a bit of an aging problem. By 2050, 40% of the Japanese population will be over 65 years old. Their population will be in a relentless death spiral for decades. Japanese elderly will be selling Japanese bonds in order to survive. Japan�s biggest customer for their debt will no longer be a buyer, they�ll be a seller. |
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| It should be clear that Japan is stuck between a rock and a hard place. A weakening Yen combined with a demographic nightmare would reduce demand for bonds paying 1.0%. This isn�t a positive development when you are running $600 billion annual deficits and desperately need investors to buy your debt. When demand for your debt is weak, increasing the interest rate you pay is the logical next step. Sounds reasonable unless you already have $10 trillion of debt outstanding. Currently, interest rates on 10-year Japanese government bonds are hovering around 0.5%. Even at these extraordinarily low interest rates, debt service already consumes 59% of all Japanese tax revenues. |
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Titus
Joined: 19 May 2012
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| Posted: Sun Oct 07, 2012 8:14 am Post subject: |
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| Japan is not the California or Greece. It issues its own currency. Japanese banks by the direction of the MOF direct capital into industry and other productive ends, thereby raising the level of productivity and output. The debt could as easily be equity, and likely will be (though monetization). The Japanese do not issue debt for speculation as in the USA et al. As such, rising wages, low unemployment, low inflation and rising productivity. No problem. The lost decade is bunk. We'd be so lucky to have 20 years of rising wages, low inflation, low unemployment. Two lost decades for Goldman and 20 years of good times for citizens. Who/whom. |
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GENO123
Joined: 28 Jan 2010
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| Posted: Sun Oct 07, 2012 8:18 am Post subject: |
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When Mrs Watanabe cashes in her bond, she�ll want yen, so the Bank of Japan will print money to pay. The value of those yens will fall and Japan�s buying power will drop,� said Mauldin in a presentation at the Value Investing Congress.
The catalyst to tip Japan over will be when its savings rate slides into negative territory from about 1% currently, he said.
�The BOJ doesn�t give out the data until a year later. When the [savings] rate goes negative, they can�t manipulate any more,� Mauldin said.
No one will be willing to lend Japan money at the current rate so rates will go up. But the Japanese central bank can�t afford to allow rates to rise so it will have to print more money, he said. |
If Japan�s current-account was negative, Japan would depend on foreign capital to make up the deficit. Will foreigners fund Japan at 0% interest rates?
I think not.
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Bug In Search of Window
Japan has debt-to-GDP ratio of 220% and rising. As of July 9, the Yield on 10-year Japanese Bonds is .80%.
A mere rise of 2 percentage points would consume all Japanese revenues just to pay interest on the national debt.
Moreover, Japan�s demographics are such that pension plans are now for the first time last year net sellers of bonds, not net buyers. For details, please see World�s Largest Pension Fund Needs to Sell Japanese Bonds; Japan�s Demographic Time Bomb Officially Goes Off
As John Mauldin commented in his book Endgame: The End of the Debt SuperCycle and How It Changes Everything, �Japan is like a bug in search of a window.� If you have not yet picked up a copy, please do so. It�s a good read.
Once Japan�s current account balance goes negative in a sustained way and I believe that will
indeed happen, the bug will have found the window. |
So how much more can Japan borrow especially when their old people start cashing in their bonds to live?
They will start having to borrow money from abroad.
Question who is going to lend them the money?
Rising productivity ??
PRODUCTIVITY
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Japan's productivity is already the lowest among developed nations. At 70 percent of U.S. productivity, Japan was the bottom of the list for the 15th straight year in 2008, figures from the Organisation of Economic Co-operation and Development show.
Analysts blame low productivity on the failings of past growth strategies, where governments shelled out trillions of yen to support inefficient industries.
In 2000, a government led by then Prime Minister Yoshiro Mori spent about four trillion yen ($45 billion) in a stimulus package focused on public works projects.
That gave a temporary boost to the construction industry mostly by increasing jobs, but also shielded it from competition. The result was a sharp drop in productivity. |
Last edited by GENO123 on Sun Oct 07, 2012 8:28 am; edited 1 time in total |
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Titus
Joined: 19 May 2012
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| Posted: Sun Oct 07, 2012 8:26 am Post subject: |
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| No one will be willing to lend Japan money |
Japan's savings and capital are captive to the MOF. Japan is not a free economy with free capital. Japan will finance her debt internally, as it has been doing since ever. Japan doesn't need external capital b/c productivity is high.
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| Japanese central bank can�t afford to allow rates to rise so it will have to print more money, he said. |
Print money = monetize debt. As it has been doing, without inflation, because of the captive financial system. The issued money is lent a 0-1% to Japanese industry, which raises the productivity of the society. America lends to banks who jack up speculation in "assets". Do you understand the difference? Industry in the USA has a higher cost of capital than industry in Japan. Industry in Japan is also protected. Japan wins.
It's not ideal but a hell of a lot more stable than any system outside of Asia. |
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GENO123
Joined: 28 Jan 2010
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| Posted: Sun Oct 07, 2012 8:29 am Post subject: |
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PRODUCTIVITY
Quote:
Japan's productivity is already the lowest among developed nations. At 70 percent of U.S. productivity, Japan was the bottom of the list for the 15th straight year in 2008, figures from the Organisation of Economic Co-operation and Development show.
Analysts blame low productivity on the failings of past growth strategies, where governments shelled out trillions of yen to support inefficient industries.
In 2000, a government led by then Prime Minister Yoshiro Mori spent about four trillion yen ($45 billion) in a stimulus package focused on public works projects.
That gave a temporary boost to the construction industry mostly by increasing jobs, but also shielded it from competition. The result was a sharp drop in productivity. |
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Titus
Joined: 19 May 2012
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| Posted: Sun Oct 07, 2012 8:39 am Post subject: |
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| Japan's productivity is already the lowest among developed nations |
That's amusing.
From that article:
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| While the economy's overall productivity rose 13 percent between 2000 and 2007 |
As the population shrunk, wages appreciated and unemployment remained low.
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| That said, the main growth engine for the economy has been the manufacturing sector, where output rose 19 percent in the decade up to the 2008 financial crisis. |
And Japan over-employs in industry and all sectors, deliberately, to keep unemployment low. Americans see inefficiency and Japanese see stability. Been to Detroit? How about Hiroshima? Virtually all income growth in the West is directed to the usurers. Not so in Japan. The gains from usury are directed into industry, which over-employs (spreads the gains among workers) and keeps the system flush with demand.
Japan does not operate by the rules of neo-liberalism or whatever we call it. |
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visitorq
Joined: 11 Jan 2008
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visitorq
Joined: 11 Jan 2008
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| Posted: Sun Oct 07, 2012 10:09 am Post subject: |
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Here's a good statement about it:
http://heartiste.wordpress.com/2012/01/09/japans-glorious-stagnation/
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It�s about �Who, whom?� as usual.
Foreign investors i.e. American hedge funds, banks, etc. don�t like Japan because Japan�s real estate and financial markets have been flat. That�s what�s meant by �lost decade�. It�s not that it�s been that bad for ordinary Japanese, what�s been �lost� is the opportunity for these foreign investors to make capital gains and extract more money out of Japan for themselves.
What the foreign investors wanted was for Japan to sell its people out and gin up its real estate and financial markets by things like immigration population growth.
A flat, low real estate and financial market is not necessarily a bad thing for your ordinary citizens. It keeps the costs down for your ordinary citizens to buy.
This applies not only between foreign investors and ordinary Japanese, but also between Wall St. and ordinary American citizens in fly-over country. |
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Titus
Joined: 19 May 2012
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| Posted: Sun Oct 07, 2012 10:17 am Post subject: |
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| Heartiste! VQ, we're on the same page. |
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Steelrails
Joined: 12 Mar 2009
Location: Earth, Solar System
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| Posted: Sun Oct 07, 2012 12:07 pm Post subject: |
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I've also heard it discussed that Japanese view corporations differently. In their view corporations are much more responsible for social welfare and stability. The corporation ultimately exists to provide employment to the people. The corporation gets enormous latitude and support as long as it continues to provide gainful employment.
This has good and bad sides to it, but overall it looks like the good outweighs the bad in terms of providing employment. |
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stilicho25
Joined: 05 Apr 2010
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| Posted: Sun Oct 07, 2012 1:06 pm Post subject: |
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You all are some crazy dudes. Anyone who lives here can see the problems. No kids and a ton of old people. When I first moved to Japan about 5 years ago I was shocked to see a bunch of abandoned villages north of Kagoshima.
Now I when I wander through some of the suburbs of Kobe I see the same thing. The only difference between Detroit and Japan is as their cities die the Japanese don't burn them down.
Social democracy is dying. It slowly kills the productive population of whatever country it is foisted on. |
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Titus
Joined: 19 May 2012
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| Posted: Sun Oct 07, 2012 2:07 pm Post subject: |
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The lack of babies is a very serious problem that if not changed will result in the extinction of the Japanese people (and Korean, Europeans and everybody else who actually creates stuff). However, I do not believe it to be due to Japan's unique political-economy.
Female liberation = ethnic extinction. The Afgans will survive.
Enjoy decadent, universalistic liberalism, all. It's our final hurrah before death.
Here is who will inherit the earth:
Rank
country (children born/woman) Date of Information
1 Niger
7.16
2012 est.
2 Mali
6.35
2012 est.
3 Somalia
6.26
2012 est.
4 Uganda
6.14
2012 est.
5 Burundi
6.08
2012 est.
6 Burkina Faso
6.07
2012 est.
7 Zambia
5.85
2012 est.
8 Afghanistan
5.64
2012 est.
9 Congo, Republic of the
5.59
2012 est.
10 Angola
5.54
2012 est.
11 Mozambique
5.40
2012 est.
12 Ethiopia
5.39
2012 est.
13 Nigeria
5.38
2012 est.
14 Malawi
5.35
2012 est.
15 Timor-Leste
5.32
2012 est.
16 Benin
5.22
2012 est.
17 Congo, Democratic Republic of the
5.09
2012 est.
18 Tanzania
5.08
2012 est.
19 Guinea
5.04
2012 est.
20 Liberia
5.02
2012 est.
21 Sao Tome and Principe
4.94
2012 est.
22 Chad
4.93
2012 est.
23 Sierra Leone
4.90
2012 est.
24 Equatorial Guinea
4.83
2012 est.
25 Rwanda
4.81
2012 est.
26 Senegal
4.69
2012 est.
27 Togo
4.64
2012 est.
28 Gaza Strip
4.57
2012 est.
29 Central African Republic
4.57
2012 est.
30 Gabon
4.56
2012 est.
31 Madagascar
4.45
2012 est.
32 Yemen
4.45
2012 est.
33 Guinea-Bissau
4.44
...
Now about that War on Women... |
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