The Coming Economic Collapse Of Japan – And Why You Should Be Extremely Concerned About It

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Most Americans pay very little attention to what is going on in the economies of other nations.  But they should.  The reality is that in today’s global economy, what is happening on the other side of the world can have a dramatic impact on the U.S. economy.  In particular, the ongoing implosion of Japan’s economy should greatly concern us all.  Japan is the 3rd biggest economy in the world and is one of America’s most important trading partners.  If Japan experiences a total economic collapse it will create a tsunami of financial panic around the globe.  In fact, it is likely that a default by the government of Japan would plunge the world into such an economic nightmare that the American Dream would quickly vanish for millions of American families.  So just how close is Japan to a financial collapse?  Well, Fitch Ratings says that Japan’s gross public debt has reached 201 percent of GDP and is likely to continue to pile up into very dangerous territory for the foreseeable future.  It is estimated that this gigantic mountain of debt amounts to 7.5 million yen for every person living in Japan.  Needless to say this is extremely troubling.  Japan has the highest level of public debt to GDP of any of the industrialized nations.  Japan is literally drowing in red ink.  Meanwhile, even with all of the massive government spending that has caused all of this debt, Japan’s economy still continues to implode at a frightening pace.  Japan’s discouraging battle with deflation dragged into its 13th straight month in March as prices continued to decline and the unemployment rate rose sharply.  In fact, the number of unemployed in Japan totalled 3.5 million in March.  This represented a 4.5 percent rise from the same period a year ago.


In an attempt to combat this economic lethargy, the Japanese government has tried to spend its way into prosperity despite plummeting tax revenues and soaring welfare costs.

But it isn’t working.

So the government of Japan has found itself caught in a spiral of borrowing ever-increasing amounts of money.

Hideo Kumano, the chief economist at Dai-ichi Life Research Institute, says that the only way that Japan can keep from going bankrupt is to keep borrowing more money….

“Japan’s revenue is roughly 37 trillion yen and debt is 44 trillion yen in fiscal 2010. Its debt to budget ratio is more than 50 percent.”

In fact, according to Kumano, if the government of Japan did not keep borrowing massive amounts of money, it “would go bankrupt by 2011.”

Fortunately, the financial implosion of Japan is not likely to happen that soon.


Well, for now they are able to borrow lots of money at very low rates.

Up to this point, the government of Japan has been able to borrow money at ultra-low rates of around 1.30 percent for 10-year bonds, drawing on a huge savings pool from its own citizens.

But that savings pool will not last indefinitely.

So what happens when the government of Japan has to start paying much higher interest rates for the money it borrows?

Well, when that happens things will get very messy for Japan very quickly.

In fact, there are already signs that the Japanese government is quickly moving into the danger zone.

In January, Standard & Poor’s warned that it might have to cut its rating on Japanese government bonds.

We have all seen what happened when Standard & Poor’s cut its rating on Greek debt, and Japan’s economy is much, much larger.

When a debt crisis does happen in Japan, it could happen very, very quickly.

According to Kumano, there will likely come a “tipping point” when world markets will recognize that the government of Japan simply cannot afford to finance its debt any longer….

“It’s hard to predict when the bond market might collapse, but it would happen when the market judges that Japan’s ability to finance its debt is not sustainable anymore.”

When you start to see world headlines about a debt crisis in Japan, hold on to your hats, because that could be the start of something really, really bad for the world economy.

Let us hope that it is not something that will unfold any time soon, but the truth is that many economists now consider the financial collapse of Japan to be inevitable.  Now may be a good time to look over your portfolio and start preparing for the worst.

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  • Greg

    It is obvious that Japan needs a serious dose of prosperity preachers to pull them out of their slump. There are soon going to be a lot of those fleecers in America that will be unemployed once the sheeple in this nation realize that they have been duped.

  • Armageddon Thru To You

    Read your bible and study bible prophecy and you’ll understand perfectly, everything that is now happening in the world from collapsing economies, the emerging one-world government, the rise of a certain hate-filled religion, and nuclear war in the middle east and shortly thereafter, everywhere. The bible is encrypted with similes, typologies and other foreshadowed events that even most Christians don’t see. WAKE UP! Accept Christ, repent and pray unceasingly that you will be counted worthy to escape what is coming very soon.

    • Comments and sentiments like this are so utterly unhelpful. We need tangible solutions to problems, not an irrational retreat into religion. Whatever happened to solid public education and independent thinking in this country?

  • Having lived and worked in Nihon for several years I have to say that the collapse will be just what the doctor ordered. A largely Godless and depraved phoney society and people.

    The murder of over 20 million of their fellow Asians along with thousands of Americans, Canadians and Europeans will finally be avenged.

    After the collapse-the Godless and Racist Japanese may learn to stop such horror in the world.

  • The collapse of Japan will be a welcome event. Interpol Reports that over 90 percent of all Child Pornography is produced in Japan. Most Japanese and the gaijin who flock to the place are hedonistic and immoral libertines who fancy themselves to be gods.

    The crash will be beautiful and long overdue.

  • Mike

    Bobby says:
    > After the collapse-the Godless and Racist Japanese may learn to …

    Extra! Extra! Pot calls kettle black! Read all about it.

  • Harrison Terran

    It seems our politicians lack the competence to deal with the many
    problems arising from the economic crisis. Perhaps they need advice from
    professional economic crisis specialists. For example, the Orlando Bisegna
    Index, specialists in the economic crisis, have developed a program that has
    helped various counties with debt problems, business failures and unemployment,
    thus improving the economic condition of many families. The program has arisen
    from their development of the Orlando Bisegna Index, a unique index based on
    206 diverse indicators that measures the intensity of the economic crisis in
    the G20 countries and other Euro countries.