If you look at the progression of the US stock market boom and bust, it’s easy to see comparisons to the long deflationary slog experienced by Japan.
What’s more, we have a similar monetary structure (our own currency, with mostly domestically-owned, domestically denominated debt), and we’re facing a similar crisis (too much private sector debt).
Anyway, the Treasury market shows it as well.
The spread between current Treasury yields and yields on Japanese Government Bonds has hit a new multi-decade low.
And beyond that, the progression of the Treasury yield collapse has has gone at a similar pace.
This chart comes from Nomura’s Richard Koo, lining up 10-year yields between Japan and the US at the start of their respective crisis.
Bottom line: Yields have a lot longer to fall if you think Japan is a good guide.