Tuesday, April 26, 2016

Lessons from Japan: Decades of Decay, 
Unavoidable Collapse
The Cost Of Accumulated Debt Dominates Japan's Expenses
"Japan has proven that decay can be stretched into decades, but it has yet to prove that gravity can be revoked by central bank monetary games .. Decay can last for decades, enabling the status quo of the state and media to maintain the illusion that superficially all is well. As visitors and paid pundits never tire of exclaiming, Japan remains a wealthy nation where everything works wonderfully well--public transport, etc.--and the average lifestyle is enviable: long lives, good health, an abundance of consumer goodies, etc .. But this well-being has been maintained at a high cost. Social cohesion is fraying, birthrates continue to decline and the signs of economic stagnation are visible to anyone who peeks beneath the hood. The Keynesian fantasy that Japan has embraced holds that every problem can be solved by printing more money. The Keynesian faithful (a.k.a. the Keynesian Cargo Cult of Paul Krugman et al.) hold that there is no problem that can't be solved by printing more money and issuing more credit. Not only are some problems immune to printing/borrowing more money, the reliance on printing/borrowing vast sums of money year after year creates a new set of intractable problems."
- Charles Hugh Smith*
link here to the essay

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