Friday, February 06, 2009

Japan's Lost Decade

Japan had a decade of economic stagnation.  They cut the interest rate to zero, propped up insolvent banks, and paved over half the country.  We have cut the interest rate to zero, propped up insolvent banks (and are currently contemplating ways to do so on a grander scale), and are debating how to best pave over half the country.  It's all a bit unnerving.

update: I should add though the infrastructure spending I don't view as problematic.  We have let our infrastructure decay and haven't made any improvements in ages.  I do wish there was a more rational process in allocating these monies.  The infrastructure enhancements, which by and large, won't be going out the door anytime soon should be considered under separate legislation.  Maybe we could even come up with a capital budget.

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