The Japanese model cannot be exported to all countries

- "The Japanese economic and financial model has not been changed by the crisis:
• high corporate profitability, despite the weakness of household demand,
achieved via a squeezing of wages;
• weakness of household demand and negative inflation (deflation) due to the fall in wages;
• decent growth overall, thanks to exports and the related investments;
• low interest rates due to negative inflation, while savers accept these low interest rates, which therefore makes it easy to finance the high public debt caused by sluggish growth."
- "We can see this model trying to spread to many other countries in the wake of
the crisis. But it cannot be exported to all countries, as it requires:
• significant export capacity, in particular to countries enjoying rapid growth (only Germany and Japan);
• that the fall in wages and the distortion of income sharing be accepted;
• capacity to finance the economy with domestic savings;
• savers who accept very low returns on their capital."
- "Moreover, this model seems to be unfavourable for stock markets."
Natixis Flash Economics 357 20100713