Friday May 25, 2012

JAPAN NEWS AND DISCUSSION

Moody's downgrades Japan outlook on national debt

Business Feb. 22, 2011 - 10:59AM JST ( 17 )

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17 Comments

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NewsmanFeb. 22, 2011 - 11:30AM JST

Another crack in the dike ...
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ExportExpertFeb. 22, 2011 - 12:08PM JST

the lack of a coherent government

This has been the problem for years and it isnt going to get any better anytime soon. man the life boats
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theproFeb. 22, 2011 - 12:10PM JST

There's a lack of a coherent government strategy, and a lack of competent government ministers
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american_bengoshiFeb. 22, 2011 - 12:17PM JST

There's a lack of a coherent government strategy, and a lack of competent government ministers

Naaaaaaaaahhhhhhhhh!!!!!!!
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LagunaFeb. 22, 2011 - 12:18PM JST

With more than 95% of Japan debt held domestically, the rating cut will have zero effect on Japan's cost of borrowing. Conversely, the very lack of external pressure on Japan to get its fiscal house in order is a problem. Japan the lead ship in a global convey heading into uncharted waters, and how it handles (or fails to handle) these challenges will set a world-wide example.

Dark clouds often provide plenty of silver linings. For example, securitizing assets of the elderly with little ability to provide for themselves would release cash flow for their maintenance and provide a great deal of liquidity and demand for society. Times like these demand out-of-box thinking, and all is not lost if such dramatic, creative changes are made. Let us hope such a person will take charge - and soon.
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koiwaicoffeeFeb. 22, 2011 - 12:18PM JST

Ah, Moody's, the one that kept to the last day the A+++ grading to the bankrupted companies in 2008..

The same one that decides who is profitable for them.

The one -private company- that decides who can be trusted or not.

Seriously, how a company like that got to that power position?
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tokyokawasakiFeb. 22, 2011 - 12:19PM JST

There is a lack of mature adults within the government. It is managed by men (and women) who act like squabbling/bullying school kids.
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sengoku38Feb. 22, 2011 - 12:54PM JST

Let's face it, the gov has no long-term strategy on how to govern this country.
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WordStarFeb. 22, 2011 - 01:49PM JST

Is this the same Moody's that gave AAA ratings to US mortgage derivatives? Why haven't I read any news items about its top management being charged with criminal fraud?
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hokkaidoguyFeb. 22, 2011 - 02:17PM JST

Is this the same Moody's that gave AAA ratings to US mortgage derivatives?

Yep.

The only reason any of these firms are downgrading Japan's debt is to try and pressure them to start selling it off. It's one of the last untapped debt markets - and they want to open it up.
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ironchefFeb. 22, 2011 - 03:14PM JST

timberrrrrrrrr!
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smithinjapanFeb. 22, 2011 - 06:38PM JST

"Meanwhile, the country’s outstanding gross public-sector debt has been approaching 200 percent of gross domestic product, the worst among major developed economies."

Watch them deny this like they denied for half a year being third economy in the world.

The reason that most debt is domestic is because the banks screw the customer royally and then double screw them when demanding repayment on debt. Interest on bank balance is what... 0.01% here? or up to a whopping 0.07% after 10 years? That's got to be the lowest in the world. But when they lend YOUR money to someone they charge up to 14% interest. This is why J-banks were protected when the economy collapsed in 2009.
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SolidariTeaFeb. 22, 2011 - 06:44PM JST

I agree with smithinjapan : Keynesian pump-priming has been a disaster for Japan.
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NessieFeb. 22, 2011 - 06:47PM JST

Heh, sold short on yen two weeks ago. Kaching!
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presto345Feb. 22, 2011 - 08:15PM JST

They looked into their crystal balls and made an accurate prediction - like they did before. Screw them.
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mushroomcloudFeb. 22, 2011 - 10:51PM JST

Told you so.
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nigelboyFeb. 23, 2011 - 12:10AM JST

The reason that most debt is domestic is because the banks screw the customer royally and then double screw them when demanding repayment on debt. Interest on bank balance is what... 0.01% here? or up to a whopping 0.07% after 10 years? That's got to be the lowest in the world. But when they lend YOUR money to someone they charge up to 14% interest. This is why J-banks were protected when the economy collapsed in 2009.

The reason that most debts are domestic is because the financial institutions aren't lending. Hence, there is a wide gap between the deposits held and the loans outstanding. Nearly 80% of the debt holdings are of financial institutions, insurance companies, and Central government. Only 5% or so are held by households.