It's The Economics, Stupid!
Features:
8. World Economy 1980 – 93
- The Economic Chippendales
- How did they get those muscles?
- Prime beneficiaries of a long boom
- They made a good start – but what next?
- Group psychology
- Same as the Japanese stock market
- Beware of the Magicians
- Corporate Magicians
- The highest order of magicians – the Bundesbank
- The necessary transition of the Japanese
- Political Japan 1980
- Political Japan 1983
- Corporate Japan 1985
- Private Japan 1985
- Private Japan 1987
- Corporate Japan 1987
- Banking Japan 1987
- Political Japan 1987
- Private Japan 1987
- Corporate Japan 1989
- Political Japan 1989
- Banking Japan 1990
- Corporate Japan 1990
- Banking Japan 1992
- Political Japan 1992
- Sinking in ‘sync’
- Competitive devaluation – purely deflationary
- 1980s Bubble goes international
- France shows another problem
- What allows a bubble to grow internationally?
- The car – an asset or a consumable?
- Sorry Japan but you did help to cause the 1980s bubble
- Not just the fall in share prices
- Very fast slowdown
- Dramatic changes in public sector finances on the horizon
- You too, Germany
- A world public sector finance problem
- Go back and read Adam Smith
- Governments do not understand – it is the banking system and the stock markets that control the economy and the public sector purse
- The Central Banks can attempt three ways to revitalise bank lending: -
- *** Go on – Tell the banks to lend – but they are not going to listen
- *** Dramatically reduce interest rates
- Buyers beware - Corporate bond markets have become quasi equity
- Increasing personal sector debt a necessity!!!
- *** Ah yes – why not reduce the capital reserve requirements?
- That is the supply side – but what about demand?
- Capitalist banks are only ‘good time Charlies’
- What about investment? It was so easy
- Why should we always need to grow?
- Competition and currencies
- Currency value for expanding technology countries less important
- Technology boom over, then devaluation is the key
- Agricultural countries currency sensitive
- Import substitution the key for developing countries
- Interest rates the key to development
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