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I would only quibble with this point:
The Japanese and Greenspan have made borrowing way too cheap.
I think Greenspan has had very little to do with this.  There are major deflationary trends in the world today, with so much low priced labor in, for example India and China, finally getting a chance to work productively.  This is putting major pressures on prices and costs in the world economy, thus keeping inflation down worldwide.  and at the same time with all of this newly available productivity, the opportunity to invest and harness those resources is incredible.  Couple that with the ability for so many people to access information, knowledge and learning on the internet real time,,,,and you have a growth explosion.  All of the things needed to produce economic access,,,,,hampered only by some of the political risk from the Middle East accented by that area controlling so much of the oil.  so cost of capital has to be low, just given the worldwide situation and economics.

Japan, imo, is a one-off due to their unusual situation in demographics.  thus a stagflation for years,,,,,and a prelude for the world looking out 5--20 years.  ie, wonderful situations don't last forever.

by wchurchill on Tue Mar 27th, 2007 at 02:09:11 PM EST
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