interesting problem
they have high debt, but an EXTREMELY strong currency. zero inflation.

namatad: interesting problem
they have high debt, but an EXTREMELY strong currency. zero inflation.

The extremely strong currency IS the problem. Japan lives or dies by her export volume. With the yen way up the stratosphere, Japanese goods are ever more unaffordable in a global market struggling with a deep recession. The Japanese government is vividly aware of the problem but all they've done is hold summit after toothless summit while the yen trades higher and higher. They had better intervene and soon. If they thought the last earthquake was bad, the new earthquake building up on the fault line of debt will make Fukushima look like a fart in a blizzard.

CitizenTed: namatad: interesting problem
they have high debt, but an EXTREMELY strong currency. zero inflation.

The extremely strong currency IS the problem. Japan lives or dies by her export volume. With the yen way up the stratosphere, Japanese goods are ever more unaffordable in a global market struggling with a deep recession. The Japanese government is vividly aware of the problem but all they've done is hold summit after toothless summit while the yen trades higher and higher. They had better intervene and soon. If they thought the last earthquake was bad, the new earthquake building up on the fault line of debt will make Fukushima look like a fart in a blizzard.

but this is an "easy fix"
print more farking money.
raise your inflation to 1-2%, slowly devalue your currency. my guess is that the 12 trillion yen that they are planning to use for this wont be enough. japan is way to conservative/risk adverse to risk pushing too hard and upsetting citizens.

How many grains of rice to the Yen?

Also, if you put one grain of rice on the first square of a chess board, two on the next, three on the next and so forth, how many squares you you need for a quadrillion grains of rice? And what's the rice worth?

Gosling: namatad: but this is an "easy fix"
print more farking money.

Please don't make me go get the Zimbabwe dollar.

LOL
there is a LONG stretch between 1-3% inflation and hyperinflation.
But man, japan has been stuck for quite awhile now. which I guess is better than crashing and burning.

the spending on rebuilding will probably help increase inflation and provide some short term growth.

hmmmmmmm maybe we need a global war to rebuild from. or a meteor strike.

zarberg: Because unlike the U.S. national debt (which is owned mostly by the likes of China, Japan, Saudi Arabia) almost all of Japan's debt is internal.

Actually, most US debt is internal as well.

Larofeticus: namatad: hmmmmmmm maybe we need a global war to rebuild from. or a meteor strike.

Let's go break some windows and see how much more prosperous that makes us.

yes no maybe

a global war or giant meteor strike would also KILL millions of people. Let's go crazy and kill a billion people. this has benefits ignored in the broken window fallacy. nor was I implying that the NET would be positive.

the war itself would employ tons of people. the reduction in population would also help reduce population. wars tend to accelerate research and development. If we assume a really good war with lots of destruction, there would be a great need for reconstruction. tons of new jobs. wars distract populations from local problems.

so you have assumed that I cared about a net gain for society. I was implying only that a large war would change everything, including the calculation of net benefits.

the effect on the global economy alone is incalculable. Countries would begin producing things locally which they previously bought globally.

the broken window fallacy ignores a huge number of externalities.
increase in police, courts and prisons to deal with increased crime.
possible decrease in overall crimes because of increased police and prisons.
(would CA have LESS crime if they built enough prisons to avoid having to have early release?)
replacing the window would employ the glaiser, glass maker. these people now have money that they can use to expand their businesses.

economies are strange. see the man in the white suit