11-29-2016, 04:05 PM
(11-19-2016, 03:23 AM)Galen Wrote: There is some truth to this but Japan has always used inflation as a way to devalue their currency in order to make their exports more attractive. After the stock market crash in 1989 they then explicitly used Keynesian monetary and government fiscal stimulus to try to revive their economy. Abenomics is simply taking this to extremes.
Japan has never explicitly had a free market economic in the Classical Liberal sense the Europe and the US did.
You have noted the negative effects of this policy on the young who also tend to be poorer and not hold equities. This has made wealth inequality greater than it otherwise would be just as it has in the US. I would also maintain that in addition to the taxes that fall more heavily on the poor, the decrease in purchasing power caused by inflation has fallen on the poor and the young. It seems likely that this is part of the reason why family formation and the lower birthrate has affected Japan more than it has in the US and Europe.
So you believe that negative interest rates are fully compatible with inflation then? Please elaborate.
There's an issue here, but calling it inflation is simply wrong.
Intelligence is not knowledge and knowledge is not wisdom, but they all play well together.