quote:
"In many respects, Japan is the template for what's to come in other developed markets. After an enormous credit bubble which burst in 1990, Japan has refused to restructure its economy in order for it to grow in a sustainable manner. Instead, it's chosen the less painful route of printing money to try to revive the economy and reduce debts in yen terms...comment:
... The trouble with this is that there comes a point where bond investors lose confidence in the ability of the government to repay the money. These investors then refuse to rollover government debt at low rates. When bond markets dry up, they normally do so quickly. The current wobbles in the Japanese bond market can be seen as a prelude to this endgame.
What about the US? The causes may be a bit different here, but the effects will be the same. What I mean by this is that there is this delusion that the government can restore prosperity. That thought reminded me of this book, which pretty much sums up the case.
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