Pages

Wednesday, November 9, 2011

Italy vs. Japan Debt to GDP Ratio

 If Italy's debt loads are unsustainably high, then what should one think about Japan?  The country has an economy and population that is shrinking and a national debt that is much larger than Italy's.

Click to Enlarge
I've cherry picked debt numbers that show Japan in the best light.  More comprehensive government debt numbers would show Japan's Debt to GDP ratio well above 200%

2 comments:

  1. External debt is different to internal. Italy the former, Japan the latter. See what Rogoff and Reinhart have to say about financial repression.

    ReplyDelete
    Replies
    1. At some point excessive debt becomes unsustainable and holders of debt lose portions of their investment. Whether those holders are internal or external is largely irrelevant. Somebody is going to lose money.

      Delete

For compliance reasons, I don't post comments to the site, but I do like hearing from readers and am happy to answer any questions. Feel free to use the comment box to get in touch. Please leave an email address in your comment so that I can write back, or email me directly at Skrisiloff@avondaleam.com.