Japan has often been portrayed in US media as a futuristic society: you know, robots and the like.
But more and more, the story has been about the Japanese economy looking like what we’ll look like in 10 years — a land of endless cheap money, sub-1% rates on 10-year bonds, and a three-decade slump in stocks.
The New York Times has a very worthwhile piece on the state of Japan, focusing on its economy, and its effect on the national psyche.
It starts with a terrifying little anecdote:
Like many members of Japan‘s middle class, Masato Y. enjoyed a level of affluence two decades ago that was the envy of the world. Masato, a small-business owner, bought a $500,000 condominium, vacationed in Hawaii and drove a late-model Mercedes.
But his living standards slowly crumbled along with Japan’s overall economy. First, he was forced to reduce trips abroad and then eliminate them. Then he traded the Mercedes for a cheaper domestic model. Last year, he sold his condo — for a third of what he paid for it, and for less than what he still owed on the mortgage he took out 17 years ago.
17 years later selling your home at a 66% discount? It’s not even that bad yet in Las Vegas! We sound childishly greedy talking about a housing recovery in 2010 just a couple years after the peak.
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