Booms, Busts, and Recoveries Message Board

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Strategies & Market Trends : Booms, Busts, and Recoveries

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To: TobagoJack who wrote (67169)	8/9/2005 10:06:46 AM
From: Moominoid	Read Replies (2) of 74559

The difference is in the US the net savings that fund the government borrowing to spend on building junk or paying bribes in Iraq or whatever have to come from foreigners or the corporate sector (as consumers in net don't save as we know, some do and some dissave of course) while in Japan from the savings come from the consumer primarily. Net US saving is done entirely by the corporate sector from retained profits, with the government dissaving and individuals at zero. But in the end is there such a big difference? One difference is that long-term interest rates are still relatively high in the US compared with when Japan borrowed all that money.

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