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Interesting perspective from the Economist on deflation in Japan, and England and America following Japan in to the black hole.

Same chords, different tune
Nov 26th 2009 | WASHINGTON, DC
From The Economist print edition

There are enough similarities to worry

FOR policymakers in the rich world, Japan’s plight is the stuff of nightmares. The damage from the early 1990s property and banking bust lingered for years, devastating the government’s finances and, eventually, enveloping the economy in deflation. The effects are still visible.

Small wonder, then, that a desire to avoid Japan’s experience has shaped other governments’ responses to the financial crash. Their reactions, from the speed and scale with which central banks reached for unconventional monetary tools to the focus (at least rhetorically) on fixing the banking mess, all contrast with the tentative initial response to Japan’s bust. But will that be enough? Close inspection suggests that, from America to Britain, worrying similarities with Japan remain. And on some counts today’s post-bubble policy challenges are more complex than anything Japanese policymakers ever faced.


Lest we forget: Japan's decline (beginning in 1989) came when the West and Western appetitie for exports was expanding.  American and British decline comes when economies all over the world are contracting, and demand for American and British exports...well, with defaltion now global, demand for exports is turning down historically speaking.  Japan was buoyed  by a strong global economy during its decline; now, no nation in a ddeflationary decline will be buoyed by a strong global economy.