How China Could Face Japan’s 'Lost Decades'

Low bond yields, weak inflation and a struggling property market have raised fears China may see its own version of Japan’s 1990s “balance sheet recession.” Can China change course in time to avoid its own “lost decades?”

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00:00 Introduction
01:24 Japan’s lost decades
02:29 Balance sheet recession
04:38 China’s similarities
06:43 China’s differences
08:03 Lessons from Japan

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[potblack]

Japan's lost decades was because they signed plaza accord. They couldn't say no to america. China is different, they say no at your face.

[dule-zm]

let me fix the title for yall
Can Germany Avoid Japan’s Lost Decades?

[noahpeng]

Of course. Japan is a colony of the United States. The United States can force Japan to sign the Plaza Accord, but it cannot force China to do anything that is not beneficial to China.

yes, because china has its own sovereignty

[pruthirajpradhan]

Japan was forced to appreciate it's currency way too much within a short span of time. So cut this bs.

[カータ-le]

As a Japanese, I believe there are three reasons why the Japanese economy stagnated for 30 years.
1, Plaza Accord of 1985: The yen was weak, but the exchange rate was forced to appreciate, which plunged Japan into a bubble economy. (The bubble economy is excessive and not accompanied by the actual situation.)
2, Intensifying competition in the manufacturing industry, which is one of Japan's strengths. (Due to the development of Chinese and Korean technology, things have become commodities → Japanese-made products are no longer selling well.)
3, Decrease in consumption due to deflationary mindset

[GunmanYeoh]

Off course, no U.S. military bases in China and no need for US defence Umbrella unlike Japan while Germany is in Japan's lost decade now.

[horridohobbies]

China's economy is totally different from Japan's. China's political governance is totally different from Japan's. China's geopolitical situation is totally different from Japan's. Drawing any parallel between the two is absurd and intellectually dishonest.

[Kevin-cmkc]

'We're seeing China's economy look a lot like Japan's, such as stagnant growth'
5% is 'stagnant growth'?

[lianghao]

Stop talking nonsense, Japan has missed every post-2000 tech trend. And China is leading all the current tech trends, mostly ahead of the U.S., and I think it's more realistic to worry for the U.S. than for China.

[ChLop-zzlq]

China isn't bound by a Plaza accord. If economic pain becomes unbearable, it could simply devalue the RMB, thus solve its debt problems and revive it's economy. Currently, Beijing doesn't want to offend the US and doesn't devaluate just yet. But if Trump keeps pushing, the Chinese government can easily play this card. Therefore, a Japan-style lost decade seems rather unlikely.

[anonym-cv]

no mention of plaza accord wrecking japan?

[justingriffin]

Its lucky China is a lot smarter than Bloomberg originals...

[SSELoves]

we have a saying in nepali which translated in english will be equivalent to: you are searching for lice on someone's Head while not talking about buffalo on your own Head.

[andrean]

Deflation caused by 2 factor :

1. deflation by losing purchasing power

2. Deflation by increased/over productivity.

China is in no 2.

[ReiserVergeDelfin-fvhq]

As long as they're not signing anything with Western countries like what happened with Japan when they signed the 1985 Plaza Accord.

[bad]

4% Growth in America? WOW that massive. 5% Growth in China - is the economy Gonna collapse? i mean really its so painful. America GDP PPP 29 Trillion. China its 37 Trillion. 5% on 37 Trillion is not STAGNANT GROWTH.

[frga]

I wonder do Japanese people even know about Plaza Accord?

[jayceh]

A retiring Chinese person (60) joined the workforce in 1980, with barely 10 years of total education, and 25% completely illiterate, works at a unprofitable SOE, basically as an assistance program.
That worker is being replaced by a college or university graduate who's a digital native with 20 points higher IQ.
Productivity is ~2.5x higher on average.
This is the fundamental difference between Japan and China's "demographic collapse"
When the 2010 worker retired in 50 years, 2060, if productivity gains slow worldwide, then we may see a lost decade.
But don't count on it now.

[gunjitkumar]

Bro who is the Thumbnail Designer for this !?
It's not a thumbnail it's a fking piece of art, really Genius, whoever you are, great work man.