Tuesday, February 06, 2007

Japan's Fiscal Conundrum

Edward Hugh has a well thought out post over at Japan Economy Watch which addresses the fiscal problems that Japan faces due to its combination of a large national debt and aging population. Edward raises the prospect of that combination resulting in a default scenario for the Japanese government sometime in the future. This is quite a radical viewpoint in light of the prevailing wisdom that Japan will be able to eventually return to its glory days of economic ascendancy.

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