Quote:
Originally Posted by blankall
Japan is a totally different situation. Falling population and stagnant NGDP. Places with falling population also, generally, have shrinking economies, and its not an envious position to be in. Japan has actually been struggling to increase inflation rates for several decades now.
You're correct. The money ends up in the hands of businesses....after people spend it....and at higher rates than normal....because inflation.
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Japan has been stuck in stagflation. Their economy is completely stagnant and shrinking for decades. They actually want out of this but they can't due to demographics and insularity. You can buy a Big Mac for the same price it was a decade ago but you don't have any young workforce replacing the old.