Apocalypse in Japan?... not yet thinks The Economist... explores the alarming future for Japan's finances... Cassandra's curse "was that her warnings would never be believed." - for yrs, doom & gloomers have tried to short Japanese govt debt but the trade has never worked... points out just 4% of Japanese bonds are owned by non-residents - yields are still positive in real terms because of on-going deflation... however now more citizens are reaching retirement age & not saving & the govt pension fund has admitted it has no new money to buy more debt.. "The crisis will surely arise when Japan becomes dependent on foreigners for finance, or if a sharp rise in inflation or a sudden slump in the currency causes domestic private investors to take fright. But since the country is still running a current-account surplus, the yen is trading at 90 to the dollar (compared with 124 in June 2007) and deflation is forecast for the rest of the year, the apocalypse seems unlikely to occur in 2010."... http://www.economist.com/business-finance/displaystory.cfm?story_id=15663864 (4*)