Greetings

Went back to about DJIA 1998 to find the same numbers as today

Our economy hollowed out and sent overseas and now we all pay the piper with out meager earning as Walmart greeters

Welcome to economy 2.0

The Japanese propped up bad banks. The balance sheets on Japanese banks are a multidecade problem.

We will follow a similar path. At the margin experts cry this is the end of derivatives, leverage, and complex financial instruments.

Say it ain't so, we should expect the revival of these practises, whether they are regulated, is anyones guess. If they are, of course that legitimizes the practise, and the banks can return to business as usual.

Next to military hardware, the US leads the world in financial engineering. Do you really want us to give all that up?

The _only_ reason Japan's economy didn't crash into a hellhole after its bust is because it was able to _export_ its way to survival. And who did it export to? One guess.

Now, in our case, who will we export to? The EU? Japan? China? LOL. Take my word for it, the Baltic Dry Index will not rise very much higher after its 90% drop. Globalization -- and Global Trade -- are dead. Say hello to Managed Trade -- an idea dear to the hearts of the EU, China and the rest of the world. Everyone will be looking out for themselves and the small players will be forced to beg from the big boys in their neighborhood. If I were Obama I wouldn't cut the defense budget just yet. Those ICBMs may still come in handy in a pinch.

I've been following the Japanese economy for almost 20 years now. I've lived there twice for a total of seven years. The first time just as the Bubble was expanding, and the second time just as the economy was heading into the so-called lost decade. My master's degree is in Japanese political-economy.

As any student of the Japanese economy knows, it's stock market isn't much like the stock markets in U.S. or Europe. Price to earnings ratios are an almost meaningless gauge of how a company is fairing due to most stock being cross-held by other corporations with the strategy of maximizing market share being just as important as profitability. Pension and investment funds and individual share owners have almost no effect on the market because in total their share of ownership is minuscule compared to the U.S. or Europe.

Japanese companies still seek to maximize profit, but maximizing share value is not a major consideration in company strategy. This is true in part because Japanese boards and impatient major stock holders don't really exercise that much control over companies, and don't live quarter-to-quarter the way, especially, American corporations do. CEOs do not command obscene salaries and when they take a company down the way CEOs have in the U.S., some commit suicide (please take note U.S. corporate titans). At the very least, they will make very public apologies and do not expect gold parachutes for fucking up.

Another thing that helped Japan weather the economic slow down of the 90s, and will again, is the massive individual savings available to keep money moving through the economy. If the U.S. had just half the savings rate as Japan, we'd be in a lot better shape.

During the supposedly slow 90s, there was still a massive amount of commercial construction going on in the major cities. And as how Tokyo, Osaka and Nagoya go, so goes the country economically since these three population centers comprise nearly a third of the nation's population.

In short, using the Japanese stock market as the barometer of economic health is getting only a very small part of the story.

That has got to be the scariest phrase I've ever heard. People go into finance because they're not bright enough to be engineers and are too greedy to do real work. The whole point of engineering is to be able to model and predict the result of a product or process before you execute it. The last six years have seen a continuous stream of processes and products where not only where the manufacturers models not predictive of the effect but those few models which were predictive were either ignored or systematically discredited. If that's what were exporting to the rest of the world these days then "Made in America" is shortly going to become a bigger joke than "Made in Japan" was when I was growing up.

I saw that 26-year low story last night and imagined how actaully scary it would be if the Japanese pension scheme was the same as the U.S. pension scheme.

We have been taught that the best way to save for retirement is to avoid mutual fund fees by investing in low cost index funds--that in the long run, no one beats the market while fees eat away much of your potential earnings. It is disheartening when I see that every asset class in my 401(k) is down this year, except of course for cash. I have actually had very tiny positive return on the 15-year period I have been in a 401(k) plan.

10 years is a long time-about 1/5 of one's working life. Since companies started offering 401(k)s en masse only in the last 20 years (before that, the plans were really only for higher level executives), that means that many workers who participate in those plans have probably experienced actual losses on their plans. Not just paper losses, but they hold plans that are worth less than their total contributions to date.

But 10 years is one thing. I couldn't imagine waking up and realizing that 26 years of investing has yielded 0%.

What are the IMF and World Bank, if not strongarms to open up & exploit economies to powerful interests in the West, specifically the U.S? They're certainly not there to lend actual aid. What has U.S. interventionist policy in the world been about for the last upteen years? Keeping the oil companies in large profits, expanding U.S. corporate ownership of other countries' natural resources, including land, water, and mineral rights, and the exploited labor to mine them.

If other countries use our own "managed trade"/imperialist tendencies against us in our weak financial position, well...we've certainly earned it and then some, haven't we?

We're not in a position to start any more wars, either. It's so scary to me that this is how Americans react in times of crisis--maybe it's time, for the first time, we put the ICBMs away and try a different solution.