Logically speaking, shouldn't countries with higher debts be in economic troubles?
Japan's debt is even higher than Greece's, how come it seems to be doing decently with almost everyone having a job?
On that note, shouldn't Italy have gone on the same way as Greece?
Asking because some of our politicians (and even some people) are calling for austerity when Brazil's debt seems pretty tame compared to some developed nations (around 70% of its GDP).
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those yurofagot cunts cant do much about their situation because theyre constrained by the EU, the euro and germany. japan has been on decline but they wont crash like greece because their economy wasnt systematically neutered (although ameriniggers tried their best)
Debt isn't a problem, as long as it's balanced out.
Simple:
(1) Most of Japan's debt is to Japanese citizens/banks, 5% or so is foreign. Greece's debt is overwhelmingly to foreign institutions.
(2) Japan will actually be able to pay denbts. Greece won't.
debt increases when a country is in economic trouble, it doesn't directly cause trouble unless its beyond what the government can pay
Politics > debt
Debt, both public and private isn't necessarily a bad thing. In fact it's often very good for the economy to take on debt. It's only when a country has economic problems that debt starts causing problems, but debt itself doesn't cause those issue.
leave it to the apezilian to reduce a complex issue to a simplistic boneheaded preconception
This.
Whenever Japan needs to borrow money, they usually issue long-term maturity bonds to the public, most of which are held by banks and private institutions, even at a negative benchmark interest rate (which means that instead of the bank paying the depositor to hold onto their money the depositor pays the bank to hold their money).
Also, it depends on the credit-worthiness of a country borrowing. Just like people, if a country has shown time and time again to pay back the interest on the deficit, their credit-worthiness remains high, and their bond grades are usually reflective of that.
Yep, Japan with only 74% of GDP as external debt is much lower than most European countries. This figure is 245% for Greece.
Logically speaking OP, it's worthless to talk about debt in absolute numbers. At the very least, it should be talked about in comparison to GDP, and even then, it's useless without taking things like inflation and interest rate into account.
you know, japanese debt is 1050trillion yen, but by Quantitative easing, more than 400trillion yen debt was disappear.
Japanese yearly defict will decrease from 4 trillion yen to 0.7trillion yen in 2020.
Morever, If we see japan government's financial, Japanese have 490trillion government debt to others ( Others government pay debt to japanese), 3.5trillion dollar abroad asset, 1.5 trillion dollar Foreign exchange reserve, and 1.2 trillion dollar asset.
That's why japanese dollar Yen is the most saftest money over Switzerland dollar and Us dollar.
It’s all about the state of the economy and it’s future projection when it comes to GDP—debt ratio
Japan is like a Residential doctor who just finished med school and is in debt. But the debt isn’t a big deal, because they have the economic potential to pay it off one day—even if they’re slow at doing it. Lenders know there’s cash potential with lending to them. Plus, they’ve already shown their committed to carrying out big things competently. They can got the reputation and credit to get away with borrowing more money.
Greece on the other hand is like an alcoholic high school drop out with their debt situation—their future at their current rate doesn’t have much potential or anything going for it, and you probably won’t get your money back if you lend to them. If they do somehow recover, it will likely be just by barely, so don’t expect any major return on any lending with them.
Because one nation finances its debt with its own people’s savings and the other is reliant on G*rmanics.
China is the same as Japan in that sense. 100% domestic financing.
You can’t really default to yourself.
t. vulgar keynesian
Japan has control over their currency, produces shit that people want, has work morale so high people commit sudoku over it and the debt is domestic.
Greece is the exact opposite.
>every answer is completely different
Not really. People are saying two things in many different ways.
1. Japan has very little foreign debt.
2. Japan as a nation is capable of handling its internal debt, unlike Greece.
more like every answer is this thread compliments with each other.
Welcome to economics
>but by QE the debt disappears
You have literally no clue what that means, do you?
>Japan
Debt / GDP = 198% in this year
mof.go.jp
The central bank is a creditor of 40% debt. And the government is the owner of the bank.
The government can postpone paying back money to the bank forever.
So real debt is 119% (= 198 x (1 - 0.4)).
>The government can postpone paying back money to the bank forever.
Government can exchange debt with new debt on repayment date with the central bank.
Yeah and most of China’s debt is between SOEs and State Banks.
This is why “muh debt” is a retarded argument. It’s meaningless compared to a nation’s capability to pay.
People who cry about "muh debt" simply don't know a thing about economics. You see so much fearmongering here about what we owe to China, but forget that we owe around the same to Japan as well. The debt is large but it's not deadly.
Then again, interest rates add up.
Ability to pay = interest rates on bonds
If we, like the Republicans are doing, tax less while spending more, interest rates will increase.
The reason why Japan and China and UK and France’s and our interest rates are low even though we have high debt/GDP ratios is because we are capable of paying it off.
Also, GDP is an annual flow factor.
Debt is a continuous total factor.
They don’t measure the same issue. What really matters is Total Assets/Total Debt. Or the level of deficits and the direction it is going.
Bumping this interesting thread
Speak english
No one knows what you just wrote. Are you that netuoyo proxy?
But credit worthiness of Japanese government is not that high. Its credit rating is just single A level which is lower than that of average developed countries including South Korea. Japan's long term solvency is questionable to international investors.
What happens when half your national budget is going toward paying off interest?
Despite the fact that Japan's government debt only has a single grade A rating, their political stability and financial comfort levels do not worry investors as much. Since the rates on JGBs have driven the interest rate below the yield curve to the negative territory, the Japanese government does not have to worry about servicing the interest on the debt, and the rest can easily be absorbed in the BOJ, which has historically absorbed a majority of the debt along with private corporations. There's a reason why investors like Japan so much, it's because stability-wise, nothing ever happens.
Japan's debt is nearly all domestic. The government can just print more money or just decide not to pay if they want.
He's not wrong tho