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Strategies & Market Trends : Mish's Global Economic Trend Analysis -- Ignore unavailable to you. Want to Upgrade?

To: Elroy Jetson who wrote (102050)	9/16/2009 3:23:02 PM
From: Hawkmoon	Read Replies (1) \| Respond to of 116555

Japan will see terrific returns on capital only after they allow the liquidation of their excess debt. Who are you trying to kid? That excess debt is paying interest to depositors (albeit very little). If it's wiped out, that's depositor money being erased from the economy and the government, or private depositor insurance, having to step in to guarantee depositor money. If there is no debt, there are no means to pay the depositors their interest. No depositors, no means to extend lending. It's a symbiotic relationship. Debt represents payment for use of capital that is deposited or invested. And viewing the low interest rates in Japan and excessive quantity of depositor capital to which it's being paid out, debt doesn't seem to be the major problem, but rather excessive savings looking for yield. Wipe out all the debt in Japan and you still have to find a way to pay the interest on that $25 Trillion in savings. christianparty.net Hawk