Quote:
Originally Posted by Scrapper
..... as I watch the market (1.10 hours in) -275 in the last hour alone. That said, Japan holds an additional trillion. Although both are very concerning it is obvious the only direction left to go is the way of Japan ie., Keynesian economics. At the very least it will cause a similar zombie economy. The problem is it's very short-lived because of the ONLY reason Japan's economy works is we are still their trading partner. In short, the US has no one equivalent. It's all going to come down.
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Japan´s way has practically not much to do with Keynes´idea.
They are running over limit since many many years and people are getting sick from work and missing freetime. They pushed their economy that much with debt that they pay today with money that the second after next generation have to work for.
America is on the best way to do the same and what trade shall be done between 2 bankrupt countries ?
Japan also relies a lot on China. 50% of all made-in-japan-goods are actually produced in China.
On top of that Japan have a big population problem.
In a world where other countries buy from countries that also buy from them a small population is a very very big handycap.
I assume that Japan will get more and more into the ASEAN trades and will move nearer to China. Don´t forget that the asian market is the far biggest market in the world and no country can survive without this market.
But I think you are right when you say that this is not to stop anymore.
Unfortunately I think so too because too many things went wrong in the past years and
and by far the most sensitive plant on which our prosperity depends is the economy, which reacts slowly but cannot be slowed down once the process has been initiated.
The last interest rate step of the FED will delay this a little longer but not prevent it any more.
If they would even catch the most proven facts on Keynesian economics the interest rate would be already at 4 or 5% since 2 years.
And there would not be ANY kind of trade war around because this theory is based on global management and triggers.