Japan hits 600% Debt/GDP

bloomberg.com/news/articles/2016-08-30/pimco-s-baz-says-japan-in-a-bind-as-total-debt-tops-600-of-gdp

Thoughts?

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en.wikipedia.org/wiki/Net_international_investment_position
en.wikipedia.org/wiki/List_of_creditor_nations_by_net_international_investment_position_per_capita
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Thinks*

Why don't they just inflate out of it like latin americans do

They tried.

It means fuck all
Though le abenomics is a meme his economic stimulus policy that he started a few weeks ago could do some good desu

We actually try to pay our debts desu

Most Jap gubment debt is owned by Japs themselves

they're probably going to default instead of inflation.
An economy of that size crashing is still going to hurt all of us either way

economic stimulus is part of abenomics though. most economists say that monetising the debt, another part of abenomics, has also helped to curb deflation and expand money supply.

It will be forgiven eventually for being too high and Abe will be crowned king of Economics

Crunch

This.

Their central bank, heavily controlled government banks, corporations and the government are circlejerking money around, hoping to stimulate the economy. They can easily drop the debt, it'll be mostly a formal act.

Short-term Japanese bonds are still rated as investment grade, that's what matters.

How did the Japs manage to do that? They're really that bad with money?

Interest rates for Japan are only 0.4% on 30 year bonds, -0.3% for 10 year bonds. No reason not to borrow when you can do it for free or even turn a profit doing it.

geez, we're terrible with money and yet we "just" have 100% debt

to settle it the govt should sell all the amerishart shit bonds japan has
if japan did it chinks would unironically follow it

I welcome japanese immigrants to Polan if their economy crashes.

no one would let your country borrow that much in the first place though

en.wikipedia.org/wiki/Net_international_investment_position

The problem with Spain is its debt is owned by foreign entities

>Thoughts?

The UK economy will grow larger than them it is inevitable

After the pound devaluation you are actually below France.

Wait for the next GDP reports by IMF.

ITT: not understanding japanese economics

japan is the world's biggest creditor nation, they have 2.8 trillion in loans given to other countries. most of their debt is internal anyways and owed to japanese banks.

its the reason why jappos have not been suffering under a decade long recession, they are financially jewing the world.

en.wikipedia.org/wiki/List_of_creditor_nations_by_net_international_investment_position_per_capita

They tried. And failed

>After the pound devaluation you are actually below France.
We were below France for a few days. After the new GDP growth figures we're back above them.

Anyway the GDP hit from that devaluation is short-term. What matters is medium and long- term growth prospects

You really think so? I don't think that either Germany, Britain or France can overtake Japan unless nothing dramatic happens.

Japan has population of 125 million, Germany is at 80 and France with the UK at 65 million.

Abenomics is literally fiscal stimulus what the fuck are you writing.

Debt monetization is not an Abenomics policy. If it was, then why did they raise taxes in 2014?

That's the Central Bank, which is supposed to be independent. But guess what, it's not working.

>expand the money supply
But it's not.

Medium and Long Term India is taking your place in Top 5.

It will happen sometime in the next 2-3 years at current rates. Probably sooner.

>most of the debt is owned by Japs
Ahh yes surely they'll accept no investment return.

>They can easily drop the debt, it'll be mostly a formal act.

This is hilarious bullshit. That's literally not true.

Ask yourself why interest rates are like that user.

Also, because of this massive debt being revealed last week, bonds yields in Japan rose from -.34% to .03% in one week.

Our bonds actually have a return unlike your own.

Your central bank is taking financial losses from overpaying for bonds. One day soon there will be no bonds left to buy.

Ahh yes because that somehow determines debt obligations.

If it did, explain America.

>You really think so?
Yes

>Japan has population of 125 million, Germany is at 80 and France with the UK at 65 million.
Yep. But there's a few things you need to take into account because total population doesn't tell the whole story.

1) GDP per capita. Japan is falling behind on this measure while the UK is improving. If you have 60 people on a GDP per capita of 30 and and 50 people on a per capita of 40 then you get the picture.

2) Working age population the UK and Japan are closer and converging. It will probably take at least 15 years for the UK to overtake Japan but the countries are definitely converging and the demographic trend and the cost of servicing that debt make the convergence clear.

>Medium and Long Term India is taking your place in Top 5.

Obviously India will overtake us. But weren't we talking about France? And wasn't my original post about Japan? I wonder why you're bringing up India and ignoring how you were wrong about France.

Anyway yes, any idiot can see that India will overtake the UK, France, Germany and Japan. It is only a matter of time. Apart from India I can't see any other country which has the obvious potential to overtake the UK from behind in the foreseeable future

My prediction for the UK in a few decades (assuming no huge wars or epidemics or singularities) is that we fall behind India but overtake Germany and Japan, which leaves us in 4th place. Which is still in the top 5 contrary to your claim that India will "take our place"

>its the reason why jappos have not been suffering under a decade long recession,

Uhhh

>It will happen sometime in the next 2-3 years at current rates. Probably sooner.

Uhhh no

>Apart from India I can't see any other country which has the obvious potential to overtake the UK from behind in the foreseeable future

With some major reforms Brazil will be taking your spot, and apart from that Indonesia is also looking like a strong contender in 2 decades time. South Korea is unlikely due to limited population.

UK's only chance of surpassing Germany or Japan would involve accelerated population growth which is unlikely given UK birth rates. Immigration is the only other option, but post-Brexit that will also seem unlikely. You would need to import several million immigrants in a decade or two.

Or stagnation or whatever.

Their standard of living and GDP per capita have all improved consistently while manufacturing/exports have no increased because japanese congolomerate banks are able to buy into foreign economies.

To be fair, it'll take 20-30 years for y'all to catch Japan

Which by then will have 95 million people, and you guys 80.

Regarding India, those guys should be ahead of us already. It is unacceptable that they're still behind the UK.

The USA, China and India are the only 3 countries in the world that I view as too difficult for the UK to surpass in total GDP because the populations are just too big. The only way the UK could do it in a sustainable way (i.e. not rely on war or natural disasters to fuck up the bigger countries) is to nurture a new paradigm shift like the industrial revolution, which is something that's unlikely and difficult to predict

>With some major reforms Brazil will be taking your spot, and apart from that Indonesia is also looking like a strong contender in 2 decades time.

At current +7% growth rate plus a modest 2-3% inflation rate (4% is more likely) India will easily steer ahead of France and UK by the end of the decade if not a few years prior. Especially considering flat growth rates in EU and UK.

It is simple math.

Brazil is still mostly a resource economy, its built like it was a decade ago, selling commodities and raw goods. It barely has R&D so it won't be creating new tech.

Britcucks atleast have financial wizardry and some although not much R&D/tech.

>To be fair, it'll take 20-30 years for y'all to catch Japan
Yeah that's fair. My "at least 15" is the most optimistic case and probably needs some financial crisis in Japan to happen

>Their standard of living and GDP per capita have all improved consistently
But slower than America's.
>while manufacturing/exports have no increased because japanese congolomerate banks are able to buy into foreign economies.
??? They aren't even back to 2007-2008 export levels

It'll be 2023 at current growth rates and exchange rates.

7% in India, and 2.5% in the UK.

2 Decades is a long ass period of time.

An economy growing at 5% + 2% inflation like Indonesia will double, then quadruple their current GDP base.

Brazil is also headed for some course correction and reinvestment on infrastructure and services rather than more subsidies for meme-tier commodities. They should recover by the end of the decade and emerge a strong Top 5 global-economy by 2030.

>An economy growing at 5% + 2% inflation like Indonesia will double, then quadruple their current GDP base.

Not at 5% with 2% inflation over 20 years.

More like triple.

By 2030 they'll be close the UK and France, but I doubt they'll be ahead.

>With some major reforms Brazil will be taking your spot, and apart from that Indonesia is also looking like a strong contender in 2 decades time.
Eh, these countries still have major major structural issues to getting to our level. It would require extreme UK weakness in addition to them getting their shit together for that to happen. Also you forget that the UK is constantly looking for economic reforms to make us more competitive. Brasil and Indonesia are not static - neither are we.

>UK's only chance of surpassing Germany or Japan would involve accelerated population growth which is unlikely given UK birth rates. Immigration is the only other option, but post-Brexit that will also seem unlikely. You would need to import several million immigrants in a decade or two.

You're wrong here too. Firstly, British birth rates are not amazing but *relative* to German and Japanese birth rates they are in a different league. I think for you to believe what you're saying, you must assume our GDP per capita will stagnate whereas I think there is plenty of scope for improvement.

Furthermore you misunderstand Brexit. Immigration will slow but not by a whole lot. The UK economy is a jobs making machine and it's sucking in skilled workers from all over the wrong and that will continue, as will European immigration. Difference is that we'll be able to control it better. Despite what you may have read in the papers, Brexit was not a vote for isolationism.

You are forgetting inflation. that brings it down to 2019-2020, but India is above 7%, closer to 8% by some estimates, and UK has had their outlook cut by IMF World Bank post-Brexit.

Show me your math. It's simply incorrect.

>and UK has had their outlook cut by IMF World Bank post-Brexit.
After the past few weeks of economic data and particularly the PMI surveys, their Brexit predictions are looking a bit sketchy. Obviously a lot hangs on the politics now so this is a very tough game to predict

By the way, India has consistently underperformed expectations after every expansion.

Why is this?

Because Indian "statistics" always overestimate early GDP growth.

Why? Because of the base year.
India recently changed it to 2015 after it being at 2005 levels.
This leads to an inherent slowdown in the GDP growth in the latter half of the period.

For example, growth looked great 2005-2010, but then seemingly shitted itself 2011-2015.
Why? Because of this base effect. India, much like China a few decades ago, simply doesn't know how to measure the economy properly.

It's quite amazing how well the British economy has performed these last few months.

It's almost like it unleashed some British pride and hope.

Assuming 7% growth rate + 3% inflation rate vs. 2% growth rate and 1.5% inflation rate. Which is pretty standard expectations, but arguably an unbelievably low inflation rate for India, and slower than expected growth rate.

Current for 2016(Fiscal):

2.8T (UK)
2.3T (IN)

2017:
2.898T (UK)
2.53T (IN)

2018:
2.99T (UK)
2.783T (IN)

2019:
3.1T (UK)
3.06T (IN)

2020:
3.2T (UK)
3.37T (IN)

impossible -- that earthquake they had back in 2011 should create tons of new jobs. After all, tons of stuff were destroyed

>It's almost like it unleashed some British pride and hope.

Kek. No. What happened is that after Cameron stepped down, against the odds we got a stable government with a PM from the centre of the Tory party who has a lot of cabinet level experience and a reputation for competence. This has restored a lot of confidence that was missing in the immediate post-Brexit period.

Trust me I work in an industry which has long supply chains responsible for business strategy to a degree and after that Brexit vote I was shitting bricks, everyone was putting shit on hold and there was no direction from government at all. Thank fuck we had Carney to reassure the markets in the aftermath and then that Conservative leadership election was cut short and we got Theresa May as PM. After that happened I calmed down considerably.

Those couple weeks after though, Jesus Christ that was horrible

>Obviously a lot hangs on the politics now so this is a very tough game to predict

It is certainly not the catastrophe everyone was hyping up. The main cause of concern was simply the uncertainty factor. Now that things have become clear UK should be expecting a slight revision downwards, but nothing like an outright recession like some shills were suggesting.

they should start printing more money

>It is certainly not the catastrophe everyone was hyping up.
It's certainly not, but we escaped from a bad situation. The danger was who takes control of the Conservative party after the vacuum left by DC rather than the EU aspect. We could have easily had Leadsom as PM who would have triggered Article 50 straight away, and THEN you would have seen some fireworks in the markets

Still plenty of uncertainty as we are somewhat at the mercy of events, i.e. it matters what our European friends do as well as what we do. But the main danger has been avoided thank goodness. I agree we'll probably avoid recession now. Next few years will be a minefield tho

>Those couple weeks after though, Jesus Christ that was horrible
after the vote*

India's current inflation, this year, is 6%

Furthermore, as I pointed out hereThe GDP growth in 2020 onwards will slowdown until 2025.

Finally, nominal is so difficult to judge. If India has 5-6% inflation 2016-2020, then its currency will likely depreciate more than the UK's.

If it has an unlikely 2-3% inflation, then the currency will likely remain at a similar level as the Pound.

Which has honestly become too cheap relative to the dollar because of continued political worries.

pay denbts

I think it's more like they have lost their faith to themselves. They are not unified for a cause like they used to be.

They are not making kids anymore. That is scary.

wont be long before there will be a worldwide economic collapse anyway

>Furthermore, as I pointed out here

Updating base year is a common thing, don't read too much into it.

India's nominal GDP actually increased with the last Base Year update. It mostly has to do with a black economy that is coming under taxation and now being factored into GDP.

> If India has 5-6% inflation 2016-2020, then its currency will likely depreciate more than the UK's

It is on track for 4% this year. Their currency is already overvalued due to their stronger services, and some inflation is needed and will become evident with the increased in manufacturing.

If you haven't done the math I don't know why you are arguing. In fact I am not even sure what your point is. If you think economies don't evolve and change over time I don't know what to tell you.

muh growth

Which country?

Seems like a commodity-nigger one.

It's the entire world

Given the fall of commodities, doesn't seem that surprising really.

These are the recession years for commodity-driven countries. Which is still most of the developing world.

You should note that most didn't go through a major recession in 2008. Brazil was unaffected for example, then got fucked starting 2013.

Yes yes
Pls buy yen
I hate Yen appreciation

t. Sup Forums

>It is on track for 4% this year.

Uhhhhhhhhhhhh
No

Except 50% of the slowdown is OECD.

Brazil and Russia and South Africa don't account for much of global GDP.

Also, GDP growth has been falling since 2010.

Corporate income has grown but they save money.

they don't invest because they are uncertain about the future