Japan risks going bankrupt
-
TOKYO - GREECE'S debt problems may currently be in the spotlight but Japan is walking its own financial tightrope, analysts say, with a public debt mountain bigger than that of any other industrialised nation.
Public debt is expected to hit 200 per cent of GDP in the next year as the government tries to spend its way out of the economic doldrums despite plummeting tax revenues and soaring welfare costs for its ageing population.
Based on fiscal 2010's nominal GDP of 475 trillion yen (S$7.09 trillion), Japan's debt is estimated to reach around 950 trillion yen - or roughly 7.5 million yen per person.
Japan 'can't finance' its record trillion-dollar budget passed in March for the coming year as it tries to stimulate its fragile economy, said Hideo Kumano, chief economist at Dai-ichi Life Research Institute. 'Japan's revenue is roughly 37 trillion yen and debt is 44 trillion yen in fiscal 2010,' he said. 'Its debt to budget ratio is more than 50 per cent.' Without issuing more government bonds, Japan 'would go bankrupt by 2011.'
Despite crawling out of a severe year-long recession in 2009, Japan's recovery remains fragile with deflation, high public debt and weak domestic demand all concerns for policymakers. Japan was stuck in a deflationary spiral for years after its asset price bubble burst in the early 1990s, hitting corporate earnings and prompting consumers to put off purchases in the hope of further price drops. Its huge public debt is a legacy of massive stimulus spending during the economic 'lost decade' of the 1990s, as well as a series of pump-priming packages to tackle the recession which began in 2008.
But while Japan's risk of a Greek-style debt crisis is seen as much less likely, the event of risk becoming reality would be devastating, say analysts who question how long the government can continue its dependence on issuing public debt.
-- AFP
-
Gones are the glory days. Japan has passed it best.
-
nvm lah... USA in worst position than japan lah...they can follow them and just print more yen lor.. or.. just produce more AV lor....
-
wow soon japan will be affordable for a holiday
-
Originally posted by I-like-flings(m):
nvm lah... USA in worst position than japan lah...they can follow them and just print more yen lor.. or.. just produce more AV lor....
technically, Japan is much much worse than US...............their debts are more than double their GDP, US not so bad yet...........
technically, Japan has been bankrupt for a long time................
-
These are just skirting under the radar.....we are just waiting for the global perfect storms all it takes is a few states to surface up with their problems in financing.
-
-
It not impossible for Japan to be a third world country. Japan is worse than US because US is still consider the center of the market, while Japan is easily replacable by korea, or even China. It's happening soon, look at the collaspe of Japan biggest airline, consider one of the biggest in the world. and the recall of toyota and honda cars. Yen rises too much. when it falls, it's heading to bottomless pit, when everyone buying chinese yuan.
I'm wondering if the car recall incident is exposed deliberately to the market to further cripple the unstable Japan market and to save US car market. The timing is horribly accurate. Or maybe I'm wrong...
-
Hope japan survives this economic crisis.
Hope the manga price drops as Yen drops.
Go japan for tour. Yeah !!!