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To: Step1 who wrote (1781)	6/15/1999 10:33:00 AM
From: TAPDOG	Respond to of 3536

Stephan- I thought the problem in Japan was lack of consumption, not lack of foreign investment. As Krugman provocatively puts it, they need to fear that prices will skyrocket so that they will spend now and savings will decrease in value. That's consistent with a weak yen and the devaluation policy therefore would make sense.

To: Step1 who wrote (1781)	6/15/1999 10:34:00 AM
From: Henry Volquardsen	Read Replies (1) \| Respond to of 3536

I disagree with that extract. If foreign investment into Japan would help speed up the restructuring in the domestic economy it would have happened in the 80s when foreign investment was pouring in. Yes foreign companies would restructure the individual companies they might buy but this can't happen effectively until there is structural reform that will allow the restructuring. There has been some reform but more is needed, imo. You need both foreign investment and domestic reform. A surplus of one can not cure a shortage of the other.