Barry, if there is a big tax cut, I hope more Japanese will avail themselves to Kobe Beef, or more flat TV or whatever the next craze will be. In practice, some of this will go to increase savings, which hopefully will find their way into the economy in the form of investments. The most important thing is to restore consumer confidence and thus stimulate consumption which should help balance some of the over capacity in electronics, semi cars, steel all over the rim. Sure construction project can soak some excess steel as well, improving the telecommunication infrastructure (and allowing competition in the telecommunication) could stimulate demand of electronics and semi.
Letting the government doing all the direction of stimulus (like highways etc.) is not the best use of the additional debt they will have to undertake, but should be a part of it., IMHO.
Zeev |
