“(It will) certainly take a decade until we are in a better position again”- Angela Merkel
Japan experienced a disastrous decade of economic stagnation and deflation from 1991 to 2001 after bubbles in its stock market and land market collapsed. There was a 60 percent plunge in equity prices between late 1989 and August 1992, accompanied by the onset of what ultimately became a 70 percent drop in land values by 2001–the Lost Decade. It required a series of persistently wrong economic policy decisions that ignored the lessons learned in America’s Great Depression of the 1930s. Japan’s large fiscal stimulus packages, which became legendary during the 1990s, were ineffective.
Now we have Europe.
(Reuters) – German Chancellor Angela Merkel said on Saturday it would take a decade before the euro zone was in a better position and there was much work left to be done to solve the bloc’s sovereign debt crisis.
Merkel said all of Europe had overspent for years but welcomed that all euro zone members had agreed to a debt brake like Germany’s.
“Almost all European countries have spent more over the years than they earned,” she said.
……and in America? Like nothing ever happened, we just keep spending. Sad.
