Wednesday, August 12, 2009

Applies equally to the UK as the US

Turning Japanese

I haven't found many articles expressly saying what US and UK policymakers seem very reluctant to admit - our central banks are making exactly the same mistakes as Japan did. I'm not familiar with the magazine but the article seems to make sense.

Posted by paul @ 10:30 AM (966 views)
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6 thoughts on “Applies equally to the UK as the US

  • So the Japanese have a head start then. Good, they deserve it. With a high quality, rich and diverse manufacturing capability, built upon a nation of people who save money to afford luxury and who importantly RESPECT each other, I fail to see the link between the noble Japanese and (sadly the majority of) feral US and UK citizens.

    Go Japan.

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  • Well, my point really was that Japanese policymakers made mistakes and now the US and UK are dumbly repeating them.

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  • japanese uncle says:

    Ndg

    Unfortunately the nation no longer respect each other. 20 years ago, streets were basically free of any crime in Tokyo, auguably the safest town on earth then, which is now infested by petty criminals. In 1970’s murder was a rarity in the country but today people are no longer surprised to see headlines like ‘Son killed father, or mother killed all her children’. Homelessness is rampant. During the last third of the 20th century, Japan was enjoying effectively full employment. School leavers could find job only if they were willing to work, and never starved. That is quickly becoming a thing of the past. (On the other hand, there are small number of stinking riches in the country quite like Horiemon, a notorious fraudster posing as young financial entrepreneur who, however, was arrested on account of window dressing and insider trading a couple of years ago.) Incidentally saving ratio in Japan is quickly dropping as people can no longer afford to do this. The only hope is, exactly as you say, the rigid manufacturing/engineering excellence of the economy.

    Anyway rise and fall of a bubble economy could and should leave such a horrific scar which UK won’t be able to escape. Consumers in this country must be prepared against the possible or probable economic ice age for the next couple of decades (school leavers and job seekers undoubtedly appreciates this fully by their own experience at this moment), whatever irresponsible commentators might say. (Though I simply cannot blame them, as economist making pessimistic predictions can be held responsible for causing unnecessarily gloomy climate in the economy, making the downturn even worse.).

    Incidentally, lax immigration policy (albeit much much more stricter than the UK’s) may be contributing to the skyrocketing crime rates, as inidcated by the unproportionate large number of foreign criminals (mostly from South East Asis) are posted as wanted. Look what happened in Belfast a few weeks ago!

    I hope the UK will not follow the tread of Japan, but the reality in this nation may well follow exactly the same path, in many respects.

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  • george monsoon says:

    What mistakes? hoarding cash when they should be lending?

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  • The mistakes pointed out in the article are basically putting off reform (by creating an excessively low downside risk through ZIRP) instead of getting on with cutting out the dead wood.

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  • He/she who ignores the mistakes of the past is doomed to repeat the errors again in the future. I know there is a saying that goes something like that.

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