Fed cuts rates; crisis over?

boddhisatva kbevans at panix.com
Sat Oct 17 23:50:09 PDT 1998


C. Dennis,

Like a lot of people, you like to emphasize the fact that Japan is a "1 trillion dollar global creditor." Okay, so what? Why, if they are creditors, has there been a prolonged credit crunch in Japan and none in the debtor U.S.? Why do they have a large budget deficit and the U.S. a small budget surplus? Why is this creditor status not making capital formation as easy as rolling off a log? I'm sure it's doing them good, but why does it not seem to be an answer in itself?

peace



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