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When Japan blows up.....the UK will get a real fucking

Shirakawa’s speech on Wednesday was a model of careful Japanese
optimism, saying: “Japan’s economy has started to pick up”. But let
’s
face facts Misaaki – Japan’s fiscal position is not good. In fact,
it’s stuffed.

The IMF says Japan’s gross public debt will be 218 per cent of GDP
this year and will keep rising for the next four years. The savings
rate has collapsed from 15 per cent in 1990 to less than 3 per cent
now.

And now there is a new, immensely popular centre-left Prime Minister,
Yukio Matoyamo, intent on increasing welfare spending and introducing
a new social policy. Japanese credit default swaps – that is, the cost
of insuring against the bankruptcy of the Japanese state – have
doubled in the past few months. Japan CDS spreads are now triple those
of Germany, France and the US.

Ambrose Evans-Pritchard in the London Daily Telegraph had this rather
arresting quote from an economist named Carl Weinberg: “The debt
situation (in Japan) is irrecoverable. I don't see any orderly way out
of this. They will not be able to fund their deficit. There will be a
fiscal shutdown, a pension haircut, and bank failures that will rock
the world. It is criminally negligent that rating agencies are not
blowing the whistle on this.”

Right. Well then, that’s not very good is it, Misaaki?