Japan’s Lost Decade – is it too late for U.S. to learn from their mistakes?
Posted on: Nov 12th, 2009 | By Bill Bonner | Filed under Featured, Financial News
Bill Bonner (The Daily Reckoning):
The Dow rose again yesterday – up 44 points. Gold went up too – to a new record of $1,114.
Can anything stop stocks and gold?
Trees do not grow to the sky, dear reader. And for every bounce there is a bust.
“It’s amazing, the US is doing everything that Japan did wrong,” said a friend yesterday.
Let’s see… in the 1980s Japan’s corporate leaders thought they were going to take over the world. Investors thought so too. They expanded. They wheeled. They dealed. Prices shot up and they all thought they were geniuses.
In the ‘80s, everyone wanted to be Japanese. Management consultants used Japanese words to describe commonplace insights.
For example, instead of saying that businesses always need to try to do things better, they referred to “kaizen” as if it were the secret of success.
And US economists urged the Reagan Administration to have an “industrial policy” – because that was what Japan had.
Japanese businesses were the envy of the world. Japan was the world’s second largest economy. But in growth and stock prices it was Numero Uno.
It turned out, as it always does, that Japan did not have the secret to everlasting success. Instead, what it had was what comes before a fall.
Click here to read the rest of Mr. Bonner’s article.
Best-selling investment author Bill Bonner is the founder and president of Agora Publishing. Owner of both Fleet Street Publications and MoneyWeek magazine in the UK, he is also author of the free daily e-mail The Daily Reckoning and three best-selling books, Financial Reckoning Day: Surviving The Soft Depression of the 21st Century, Empire of Debt: The Rise of an Epic Financial Crisis and Mobs, Messiahs and Markets.. 