Richard Katz of The Oriental Economist provides a counter-argument to the mainstream worries about Japanese government debt. I’m leaning more towards Katz but am looking for more guidance.
Now Is Not the Time to Fret About Tokyo’s Debts
Matt Alt explains why this:
When the set combination is forgotten, it becomes a delivery of the spare prick in the train terminal station.
I’d laugh if it wasn’t such a simple error. It’s also prominently displayed on the Narita Express for all of the visitors to Japan to read. Let’s wait and see how long it takes JR to fix this gaffe.
The Mysterious Case of the Spare Prick
Last week Hiroko Tabuchi’s article in the NYT, Rising Debt a Threat to Japanese Economy, painted a pretty grim picture of Japan’s significant debt and what that could mean to the future of Japan. What many may not have seen is Paul Krugman’s comment on his blog, Is Japan on the fiscal brink?, where he basically says that the market does not see any problem in Japanese bond yields being low- that the market expects this. If you were concerned by Tabuchi’s article, which is more speculative, it’s important to look at the market itself, as Krugman does, to see that that this issue is not much of an issue at present.