Monday, March 09, 2009

Imitating Japan isn't good, but it is comforting.

My good friend Pete has asked me to remind him, from time to time, why there is in fact hope for the economy, and he therefore doesn't need to buy a gun, stash his money in the mattress and garrison inside his house. This time around, we're using Japan as an example, prompted by a recent Paul Krugman blog post.

Now, it should be pointed out that I'm no economist. This may actually provide some comfort, I don't know. Anyways, because I'm no economist, I rely on a few different websites to provide me with some insight and analysis on what's going on out there. One of my favorite sources of information lately has been Krugman. His recently updated book, "The Return of Depression Economics", focuses specifically on the Asian economic crises of the 90's, and how they relate to what's going on today.

On the surface, Krugman's blog post should frighten us. That the Obama administration is stuffed full of some of the smartest economic minds in the country, yet continues to take the same sort of half-steps that doomed Japan to a decade of economic malaise. And they need to get over that. The system is broken, but they're trying to fix it with chisels and paint where bulldozers might very well be necessary.

Anyways, that's not what I'm here to talk about. I see today's reason for Pete not to buy a gun in the very fact that despite the fact that Japan suffered through a decade of economic malaise, they did in fact come out of it, slowly and eventually. It certainly wasn't pretty, and Japan is not the power it was before, but they did not descend into anarchy and chaos. I see this as a good omen. Even if the Obama administration refuses to take strong actions (ahem!), the cycle will eventually come around and life will go on as before, although with less credit and perhaps without the US being the same sort of economic power we were before.

Perhaps it's indicative of the times that I'm trying to take a positive out of a pretty terrible negative. Polishing the proverbial turd, if you will. But if Pete doesn't buy a gun, it'll all be worth it.

No comments: