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mdman

Zombie Banks Will Destroy Us All

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Japan embarked on a credit binge that bust 20 years ago. This was dealt with by:

- ZIRP

- QE

- propping up zombie banks

- the more or less complete capture of Government and regulators by banking and corporate interests

- deunionisation and temporisation of the workforce augmented by a flood of immigrant labour, driving down wages (33% of the workforce are on non-permanent job contracts now)

The effect on Japanese society has been devastating

- wages have deflated

- debt and mortgage principal has increased relative to wages, forcing people to extend mortgages from 20 to 25 to 50 to intergenerational mortgages

- the birth rate has collapsed - fertile women are making a rational economic choice

- as the birth rate has fallen, the demographic catastrophe (too many pensioners, too few workers to support them) facing Japan has worsened

The demographic decline has been strongly influenced by Japanese economic policy, specifically the zombie bank/ ZIRP/ QE regime and wage deflation. Economic policy affects demographics

The banking and corporate interests in the UK wish to transform our country the same way. Mandelson repeatedly says globalisation and free trade is necessary to avoid a Depression. But the effects of the policies he advocates, while they may suit his billionaire chums, will force most working and middle class people (including most professionals like teachers and nurses) into multi-year wage declines. At the same time, the QE/ ZIRP/ Zombie bank regime will keep debt and mortgage principal progressively higher relative to wages for ordinary folk, making housing and debt-free living increasingly impossible. And this will drive a decline in our birth rate.

The IMF estimates the UK banking bailout to come in at £1.2tn - £1.3tn. I have no doubt that due to the malfeasance and fraud endemic in our banking/ political/ regulatory nexus, bailouts are necessary. But I take issue to the form these bailouts have taken. In their current form, the bailouts are driving us on the road to social ruin.

End the QE, let the market set interest rates, let the banks fall, protecting their retail depositors only, force the bondholders to take a haircut and seed new unimpaired banks with some of that money we're currently p****** away down this black hole

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The bailouts should have been focused on tackling the debt, if that had happened the capital requirements of the banks would probably have taken care of themselves.

The political elite can't admit that they have been running one huge ponzi scheme.

If Japan is our destiny we are screwed, in 20 years the Japanese have never fixed the problems in their economy and are now in serious trouble as they no longer have anyone to trade with.

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worse, the japanese porn on the web has all the naughty bits pixelated out.

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Why don't they just import loads of young Pakistanis, Indians and Chinese?

They don't need to as the natives are diligent, hard working people who would rather do the most unappealing jobs rather than be a burden on their countrymen. Sitting around all day drinking and watching daytime tv paid for with taxes generated by hard working foreigners wouldn't be considered to be a lifestyle choice in Japan - more an embarrassment.

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Japan. That would be the home of Nissan - creator of the GT-R as well as some of the most reliable 'normal' cars in existence. Don't forget Toyota.

Home of Sony - the company that took gaming mainstream with the Playstation, built the Walkman and had their TVs in many homes the world over.

I'll admit I've never been there - too alien for me - but I don't think you'll find many peope who will compare it to Somalia. If being like Japan is the worst we've got to contend with (silly working hours for lower wages but far cheaper goods and massive industry of our own combined with an ethic that would make being on benefits the worst shame you can endure) then I'd argue it's far better than what we've had so far.

Edit - early submit and typo.

Edited by impatient_mug

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Japan. That would be the home of Nissan - creator of the GT-R as well as some of the most reliable 'normal' cars in existence. Don't forget Toyota.

Home of Sony - the company that took gaming mainstream with the Playstation, built the Walkman and had their TVs in many homes the world over.

I'll admit I've never been there - too alien for me - but I don't think you'll find many peope who will compare it to Somalia. If being like Japan is the worst we've got to contend with (silly working hours for lower wages but far cheaper goods and massive industry of our own combined with an ethic that would make being on benefits the worst shame you can endure) then I'd argue it's far better than what we've had so far.

Edit - early submit and typo.

no blondes in Japan either.

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Japan. That would be the home of Nissan - creator of the GT-R as well as some of the most reliable 'normal' cars in existence. Don't forget Toyota.

Home of Sony - the company that took gaming mainstream with the Playstation, built the Walkman and had their TVs in many homes the world over.

I'll admit I've never been there - too alien for me - but I don't think you'll find many peope who will compare it to Somalia. If being like Japan is the worst we've got to contend with (silly working hours for lower wages but far cheaper goods and massive industry of our own combined with an ethic that would make being on benefits the worst shame you can endure) then I'd argue it's far better than what we've had so far.

Edit - early submit and typo.

Yes it's great if you're a corporation/ bank

Not so great if you're a human

There is a way to avoid the slow motion social disintegration of Japan that doesn't turn the UK into Somalia

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Japan. That would be the home of Nissan - creator of the GT-R as well as some of the most reliable 'normal' cars in existence. Don't forget Toyota.

Home of Sony - the company that took gaming mainstream with the Playstation, built the Walkman and had their TVs in many homes the world over.

I'll admit I've never been there - too alien for me - but I don't think you'll find many peope who will compare it to Somalia. If being like Japan is the worst we've got to contend with (silly working hours for lower wages but far cheaper goods and massive industry of our own combined with an ethic that would make being on benefits the worst shame you can endure)

Edit - early submit and typo.

not another one of those, "everything is ok, were all fine, i dont know what the worry is - were clearly in better state than africa" . if japan is ahead of us, and were shrinking, why are you arguing it would be fine to be like them....

thats like someone from somalia saying look, this financial recession wont affect me, look what its done to america, if america is the product of this financial recession then I'd argue it's far better than what we've had so far in somalia.

japans stock market is roughly at the same level as it was in 1985.

20 years later house prices in japan are around 60% off the peak prices since 1990 and dropping by the year. deflation hit a record 1.7% on friday.

even if you strip out the asset bubble in japan , land prices are roughly the same as what is was in 1985. thats the same price, pre bubble, 25 years on, all due to the massive debts that are still plaguing them to this day.

they are trapped in a debt cycle.

lets see what happened in japan - massive asset price bubble, stock bubble, collapse of land prices and stock markets, collapse of the japanese banking system, government steps in to bail out the financial system, interest rates dropped to 1%.

massive, massive government and public debt.

does anything seem familiar?

Edited by mfp123

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- the birth rate has collapsed - fertile women are making a rational economic choice

- as the birth rate has fallen, the demographic catastrophe (too many pensioners, too few workers to support them) facing Japan has worsened.

We cannot base future economic policy on the idea that it is desirable that there is population growth, or even population stability. The population has to FALL. If we don't have an economic/social/pensions policy which can cope with this inconvenient fact then we have to change the policy. We can't change the inconvenient fact.

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I'm with impatient_mug.

Never been to Japan, no expert, but I would be pleasantly surprised if UK turns out as stable as Japan is now in, say, 10 years. Remember the vast private savings that offset (and enable) Japan's vast government debt. To me, the bigger risk would be that we end up in the UK with all of the things that are bad about Japan (QE, ZIRP, economic stagnation, massive government debt etc) but without the redeeming features (cutting edge technology, industrial leadership)

I would, however, be surprised if Japan can continue in this vein indefinitely. It's not clear to me that they will be able to continue their export model.

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Guest Parry aka GOD
worse, the japanese porn on the web has all the naughty bits pixelated out.

They're not. The naughty bits are just very small.

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not another one of those, "everything is ok, were all fine, i dont know what the worry is - were clearly in better state than africa" . if japan is ahead of us, and were shrinking, why are you arguing it would be fine to be like them....

thats like someone from somalia saying look, this financial recession wont affect me, look what its done to america, if america is the product of this financial recession then I'd argue it's far better than what we've had so far in somalia.

japans stock market is roughly at the same level as it was in 1985.

20 years later house prices in japan are around 60% off the peak prices since 1990 and dropping by the year. deflation hit a record 1.7% on friday.

even if you strip out the asset bubble in japan , land prices are roughly the same as what is was in 1985. thats the same price, pre bubble, 25 years on, all due to the massive debts that are still plaguing them to this day.

they are trapped in a debt cycle.

lets see what happened in japan - massive asset price bubble, stock bubble, collapse of land prices and stock markets, collapse of the japanese banking system, government steps in to bail out the financial system, interest rates dropped to 1%.

massive, massive government and public debt.

does anything seem familiar?

So what you're saying is we're 20 years behind Japan. That means we have absolutely nothing to worry about from a quality of life perspective for at least 20 years - we'll just be like Japan has been for the last 20. I'm more than happy with that. Maybe I'll leave my current foreign company and work for one of the British technology giants that are sure to emerge. I'll have to work longer, and take a pay cut but looking at Japan that doesn't look so bad - they put food on the table, drive around and live in modern towns and cities and still find the money to fly half way round the world to take pictures of Tower Bridge and go royal spotting.

If you're saying the next 20 years for the UK will be like the last 20 years for Japan then there's nothing at all for anyone to worry about. As for house prices being down since 1990 - who cares so long as you have somewhere to live? I thought massive sustained price drops were considered a good thing here?

Edited by impatient_mug

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So what you're saying is we're 20 years behind Japan. That means we have absolutely nothing to worry about from a quality of life perspective for at least 20 years - we'll just be like Japan has been for the last 20. I'm more than happy with that. Maybe I'll leave my current foreign company and work for one of the British technology giants that are sure to emerge. I'll have to work longer, and take a pay cut but looking at Japan that doesn't look so bad - they put food on the table, drive around and live in modern towns and cities and still find the money to fly half way round the world to take pictures of Tower Bridge and go royal spotting.

If you're saying the next 20 years for the UK will be like the last 20 years for Japan then there's nothing at all for anyone to worry about. As for house prices being down since 1990 - who cares so long as you have somewhere to live? I thought massive sustained price drops were considered a good thing here?

That was providing you have someone else to trade with.

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So what you're saying is we're 20 years behind Japan. That means we have absolutely nothing to worry about from a quality of life perspective for at least 20 years - we'll just be like Japan has been for the last 20. I'm more than happy with that. Maybe I'll leave my current foreign company and work for one of the British technology giants that are sure to emerge. I'll have to work longer, and take a pay cut but looking at Japan that doesn't look so bad - they put food on the table, drive around and live in modern towns and cities and still find the money to fly half way round the world to take pictures of Tower Bridge and go royal spotting.

If you're saying the next 20 years for the UK will be like the last 20 years for Japan then there's nothing at all for anyone to worry about. As for house prices being down since 1990 - who cares so long as you have somewhere to live? I thought massive sustained price drops were considered a good thing here?

how can we be like japan if we were already behind to begin with?

people are already having to change their lifestyles, trading down, buying less, going out less, taking fewer holidays, people are made unemployed, young people cant get jobs, people losing the value of their pensions.

higher taxation over the next decade will keep that in force.

you may not think that it will affect you much but i dont see how no progression for 2 decades can be glossed over.

Edited by mfp123

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