Does this sound familiar?
Too much easy credit. Overinflated stock and real estate markets. Huge debts and deficits. Financially shaky banks. A recession followed by years of anemic growth. Politicians unable to clean up the mess.
While perhaps the recipe for the United States’ current economic malaise, it is actually the road map followed by Japan during its “lost decade” of stagnation and decline in the 1990s. Japan, in fact, remains mired in economic torpor — a cautionary tale of two lost decades that U.S. economists and policymakers fear could cross the Pacific.
The two economies, and the remedies for their respective recoveries, though, are different. Japan suffered deflation and its economy ground to a halt. Americans racked up huge housing and credit card debt and lost jobs by the millions.
Japan, in contrast, kept a lid on unemployment and consumer debt. The U.S. lanced the financial boil early. Japan didn’t.
In Sunday's newspaper, the AJC compares the United States' current economic malaise with Japan's "Lost Decade." It's a story you'll get only by picking up a copy of The Atlanta Journal-Constitution or logging on to the paper's iPad app. Subscribe today.
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