Another leader who believes that cutbacks produce prosperity. Japan was one of the few bright spots that I mentioned in my 2010 Outlook. It's not anymore.
| Prime Minister Naoto Kan renewed his call on Monday for tax reform including a possible doubling of the sales tax to rein in Japan's huge debt, as ratings agency Fitch warned the country needed a credible fiscal reform plan. |
And he's kowtowing to a rating agency!! Ugh!!!!
Mike,
ReplyDeleteEven at full-capacity, can a central bank simply buy its own governments' bonds and more or less simultaneously raise reserve requirements to counter inflation?
This question just occurred to me.
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ReplyDeleteI should mention the point of the above question, which is whether this could allow for deficit reduction sans negative consequences.
ReplyDeleteOh, and by full-capacity, I'm referring to economic capacity, to be specific.
And maybe every central bank would have to do this to avoid forex consequences.
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