One thing I highlighted in my talk yesterday at the University of South Carolina was this idea that the US economy more closely resembles Japan in the 90’s more than the USA in the 70’s. But I made an important distinction between Japan in the 90’s and the current US economic environment – we are Japan on fast forward. This has been a cornerstone in my thesis for the last 4 years as the credit crisis has evolved.
And I love this chart from Richard Koo at Nomura showing that difference between the USA and Japan’s housing busts. Look at that beautiful divergence. It looks like the comparisons are becoming less and less relevant. We aren’t even Japan on fast forward any longer. We are definitely diverging….
Mr. Roche is the Founder and Chief Investment Officer of Discipline Funds.Discipline Funds is a low fee financial advisory firm with a focus on helping people be more disciplined with their finances.
He is also the author of Pragmatic Capitalism: What Every Investor Needs to Understand About Money and Finance, Understanding the Modern Monetary System and Understanding Modern Portfolio Construction.
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