Let me see if I got this straight, what your saying is that accumulation at this point in time isn't in the best interests of the Japanese or for that matter the rest of the world and that the Japanese should start spending a little bit of that accumulated cash on a world -wide basis. Or am I putting words in your mouth.
Your email pal,
Tom L.
Doug Henwood wrote:
> Rob Schaap wrote:
>
> >G'day Doug,
> >
> >You write of Japan:
> >
> >>For sure, the talk of collapse so fashionable in the English-language
> >>press is >way overdone, but you can't run an accumulation engine on sub-5%
> >>profit rates.
> >
> >Er, why not?
>
> Because: 1) it's not worth the additional risk of investing in production
> when riskless assets, like U.S. Treasury bonds, pay almost as much, and 2)
> over the long term, since tomorrow's investment is funded from yesteray's
> profits, you couldn't sustain the high levels of investment necessary to
> keep the accumulation engine running with such low profits.
>
> Doug