Title: U.S. MAY S&P/CASE-SHILLER HOME PRICES RISE 4.6% VS YEAR AGO [African American Hating Nebby on Suicide Watch] Source:
BBG URL Source:http://www.bloomberg.com Published:Jul 27, 2010 Author:CARLOS TORRES Post Date:2010-07-27 09:07:11 by war Keywords:None Views:20787 Comments:39
Some seem to think that Japan just sat back and did nothing during this time. 1989 til today.
There is nothing further from the truth. Japan was the first major economy to go down the path of quantitative easing. Japan also injected enormous amounts of money into their economy to stimulate growth. Yet the above chart is rather clear in the outcome. Some point to unemployment in Japan remaining low. This is more a sleight of hand with economic data. Although the official rate is low, nearly 1 out of 3 Japanese workers are considered part-time employed. That is, no security of long-term employment.
We have seen a massive rise in the number of Americans that now work in a part-time fashion. No benefits, lower wages, and job security that is no longer an option in the longer term. It is easy to see why asset prices in Japan have remained depressed for so long. Prices in the U.S. are showing no sign of inflationary pressures because there is little mechanism to force wages up with such a giant over supply of labor in the market. This is possibly one of the major points missed by those who predict inflation or hyper-inflation in the future. Central banks can print but they can’t force wages up especially in a global market where cheap wages are the status quo.
To the contrary, banks are following the zombie like behavior of Japan banks by hoarding funds:
