Japan economy 20 years ago

[TheRobin]

Hey everyone,

 

Today someone told me about how Japan supposedly was where the US is at now (in terms of spending/GDP/tax-income ratio) 20 years ago (and is still hanging in there somehow). Does anyone know more about that (or can anyone recommend some good articles on that?The discussion originally was about how long it might take for the US to actually go into crisis-mode and his argument was that it will take at least another 20 years, cause Japan was alreay at the same point as the US is now 20 years ago and still exist without major deflation or crisis, so that's kind of why I'm curious about it, so if anyone that can help or point me to some good sources, I'd really appreciate that, thanks

[Josh F]

There is no way spending in Japan could mirror the US, the Japanese don't have an empire to maintain with soldiers.  You can ind those stats out quickly, but our budget spending is inconsequential.  Consumer and government debt, inflation, etc, is more important.  Plus our GDP is including government expenditure, so it isn't the most reliable qualifier. 

[LanceD]

The 90's are called the "Lost Decade" for Japan due to their extensive economic issues. They luckily had the US paying for their Defense and buying their shit to help them get through it.

 

That last bit is what everyone forgets whenever they compare the US economy to the rest of the world. The European and Asian economies are all propped up by the USA. Everyone depends on us, whether its our Dollar as the reserve currency or our middle class spending buying all their stuff among other things.

 

So any comparison is completely invalid because there is no country propping the US up like it is for the rest of the world. A further decline of US economic power could have unprecedented and unpredictable impacts on the global economies, but who knows how long it will take.

[PatrickC]

Yes, Lance touched on some of the reasons. Essentially the US and historically the UK have been forever bailing out currencies by inflating their own as and when they needed too. They even used to support the Russian Rouble back in the day. Generally speaking the rest of the worlds currencies follow suit by inflating their own. Thus acquiring free money each time. It's a kind of Quid pro quo thing. This is why you don't see the inflation ever getting out of control.

 

The only reason these countries have summits is purely to discuss currency. Although they'll have us believe otherwise. I'm of the opinion that recent Libertarian projections about a dollar collapse are far further away than they thought. However, TT is quite right to point out that the US is spending like a degenerate gambler. But this only gives them some slack, as they start pulling out of domestic spending gradually. I think you'll start seeing the cuts after Obama's reign. It sort of follows why the Police have been militarising themselves, as the future riots that are likely to ensue, will make the London riots look like a picnic in the park. My guess is that any kind of total dollar crash could be as long as 15/20  years a way or more. Bitcoin is the only thing I can see as capable of shortening that timespan and potentially being a game changer. I know people who disagree with me vehemently and that's fine, I'll glady eat my hat if it happens earlier.

[LanceD]

I agree xelent. The dollar won't be soon to crash because it exists in a system created by those who want it to work. It would require a legitimate loss of faith in the currency by a significant portion of the population, or by enough of the major players in the global political system. However without something else to turn too such a decision would hurt a lot more then just suffering through the inflation. 

[PatrickC]

Forgot to mention, but all these wars in the middle east are with countries (without nukes) that have wanted to get out from the petrodollar and use some other currency to buy and sell oil and gas with. The is the real reason the US doesn't want Iran to get nukes. I think I can see a war with Iran in 10 years or thereabouts probably. The rest of the world is only to aware of this and so cowtow to American demands. Fiat printing is the kickback for complying of course. This why I see the military being the last thing they will cut. They would sooner have desubsidised farmers up in arms than give up the free money supply.