Japan has the best of it all... Prices down in RE and stock market.. Bonds yield next to nothing. And prices of things they consume are sky high! Voila! We'll maybe have all of that too one day.
in terms of the asian fin crisis: i would tend to agree with you insofar as the plan now in the west seems to be to solve a debt crisis with more borrowing and to do whatever they can to give the masses the incentive to spend on shit they don't need to 'stimulate' the economy. that said, i don't know that the asian crisis is a good model for today in terms of it being able to produce a similar outcome. the reality of that crisis is that dramatic currency devaluations saved those countries. Thai baht went from 25 to 52 vs the $. that'll do wonders for stimulating exports and attracting manufacturing, and outside $ flooding the country with investment due to the BOGO free reality of halving your currency. given the whole world is fucked this time, EVERYONE can't devalue their currency at the same time (except vs gold or other hard assets). so it wouldn't work. would i prefer it to the spend baby spend nonsense we've got going now- yep. just don't think it'll save us. i tend to think we're fucked. how long it takes for the bubble to burst- who knows. this insanity can go on for longer than i can stay solvent...
...and had a basically unlimited source of backing for that from China, something that, say, Thailand lacked.
your example is one of a unique city-state that had just went back to China in 1997. coattails... you seem pretty bright, i can't imagine that you're arguing that currency devaluation did not play a significant role in the rapid recovery in SE Asia after teh crisis. add in proximity to the monster growth in China and those 2 unique factors did the job. there are those who feel China and their manipulated growth via public works building infrastructure and empty cities will save the world this time too. lot easier to save some asian tigers vs the whole world. i think we're in agreement that the current tact in the west is kicking the can down the road to an even worse comeuppance. i just don't think there is any solution that isn't going to bring a lot more pain. like the old auto repair commercial: pay me now or pay me later...
It's not just Asia (sans Japan) in the late 1990s. Russian (of all places) was similar. Also, in the 1920-1921 depression, the U.S. actually tightened their belt and curbed spending. The newly-formed Fed didn't get involved. The result? You don't hear about it today, though it started out almost as scary as 1929-1930...
Once again, I will chime in. I deal with the very wealthy in this country, most are private manufacture owners with net worths between 5million to 100 million plus. I hear positive things as orders are ticking up, margins are good for them right now and profits are being made across the board. However, I hear Zero plans on hiring new workers and possible layoff plans if the Tax rates increase, state, fed, insurance, etc. Thus, once again, those who are weathering this storm are making money. We have had zero problem raising capital for our Private Placements which are in OIL. So far this year we have raised around 6 million. Those with money are being smart and taking calculate risk. However, the middle class will suffer. Those who work for Typical Corporations and or business who are in debt, are at the mercy of their Axe. Yet, Depressionary pressures are very small, oil is still above 70, Gold is still high and the dollar has rebound..not to mention China as its own currency floating, no longer tied to the GreenBack showing that China believes she is strong, and those who trade with her will reap the benifits. The printing machine is gona crank up...and more and more money will flood the system.....never reaching the very people who voted for Obama and his Socialistic Ideas. Bottom line, there is plenty of money being made, it is being made in key regions...like down in the South on commerical property, Oil and Gas, and corporations relocating for lower wages. As well as companies who are making more money, with less workers than ever before. This mentality will stick and few "bloated" payrolls will exist. East and West coast are in the Depression now, many of the states will be bankrupt and many social programs will be cut. Very little Muni bond actual will bring about investment money, thus, leaving most of those two regions in the depression for years to come. The growth is down in the souther'n belt. There is some sign of strength and as more and more money, people, jobs flow in to AL, TN, TX, OK, you will see more strength in those regions. The set back in LA is gona hurt the state but more and more international shipping and commeric is leaving from the Gulf Ports, from AL to TX. Those who live in states controlled by liberal dems are gona feel the pain, in a very harsh manner. US equities market will be drained of key capital before the Capital Gains hike in 2011. I suspect a move towards 6000 if not 5000 from money flowing out of the US STOCK market into Hard Assets. Once again, ALL S is not P......meaning there are ways to make serious money and build wealth right now. Most people will not...but many will come out of this stronger, wealther and happier.
Currently 10 year bonds are yielding 3% and 30 year bonds are yielding 4%, if deflation takes a firmer hold it only means it will be possible for the US to roll over debt at a lower cost. As much as I love anarchy inflation is the greather threat, if inflation takes hold higher rates and a weaker USD will feed on itself pushing eachother up at double speed it will be impossible for the US or many other countries to roll over debt, noone wants to own government debt when they go down for two reasons, higher rates and a weaker currency spiraling faster and faster down as inflation spirals up and everybody dump bonds.