The Collapse Of The Domino --- Chinese Real Estate

The Collapse of the Domino --- Chinese Real Estate
With the outbreak of the U.S. financial crisis in 2008, the whole world's financial situation is not
good, but except one, which is China. However, many people find out that China is walking on the
old U.S. economic way, which means China will have economic crisis either. So right now, all the
eyes from all the countries are watching at China's economy, because if Chinese economic collapse,
there are no more people buy Japanese animations and European luxuries. And after the economic
crisis, China will recovery U.S. Treasury bonds, but American unable to pay, then the whole world
economy is facing collapse; we can call that butterfly effect. So right now, in this context, the same
conditions, and the same nature of the Chinese economy grows up, any black swan events are likely
to be the fuse of Chinese financial crisis, and even the world economic crisis' fuse. For example, the
author of "Chinese Citizens Have Their Eyes on Bubble," C. Cindy Fan mentions that the fuse of
Chinese economic crisis is real estate. Right now, Chinese people put all their savings into real
estate, which led to the housing bubble, but because of consumer demand, the government is unable
to stop it. (Fan) I agree with Fan's idea, which is Chinese economy will collapse because of Chinese
real estate bubble.
Consequently, whether China will have the financial crisis, the focus should be on the how big is the
China's real estate bubble, and when will it burst. As for how big is the China's real
... Get more on HelpWriting.net ...

Monetary Policy Adopted On Bubble Economy Period Of...
The topic of this dissertation is to discuss the monetary policy adopted in bubble economy period of
Japanese. As Japanese economics is a specific example around the world. The Japanese government
adopted many effective ways to revitalize the economy with the result that its economy rose
abruptly after the World war II. However, because Japan entered a liquidity trap around 1990s, and
experienced a "Lost Decade" (Hiyashi and Prescott, 2002), the government experienced many
economic problems such as of slow growth, deflation, and continues nethermore output (Daniel,
2009) In this dissertation, the following parts will be given: Literature review, data description, test
result discussion and conclusion.
Briefly speaking, the literature ... Show more content on Helpwriting.net ...
Finally, a conclusion will be provided at the end of this section. At the end of this dissertation, there
is a final conclusion will be given, the conclusion will cover the reason whether the monetary policy
adopted by Bank of Japan was wrong. It will also give some suggestions about the monetary policy
according to Japan's economy.
In general, the point of this dissertation is to focus on the monetary policy of Japan during bubble
economy period and to identify whether Bank of Japan did right or wrong in such period.
Literature Review
The background of Japanese Monetary policy in Bubble economy period
As Walsh (2003) said that, 'a social loss function dependent on inflation and output gap is the
appropriate objective of monetary policy' which indicates that the level of inflation and output are
the major factors that affect monetary policy of all countries. Moreover, Castelnuovo and Surico
(2010) claimed that inflation are the key elements to decided a monetary policy for a county. For the
Japan economy, it experienced a disaster during the period 1986–1991, which named Japanese asset
price bubble (Wood, Christopher, 2005). It leaded a long term economic depression japan after that.
The main reason for the bubble economy is the extremely high inflation rate and output. As
mentioned before, Japan was sustained a rapid development after world war II, the main industry of
Japan is manufacturing industry. After the Plaza Accord

Japanese Economy During The World War
Introduction Since the Second World War, the Japanese economy had experienced remarkable
growth, transforming from a developing to an advanced developed economy in a single generation.
However, on the edge of a three–decade long "Economic Miracle," in the late 1980s, Japan faced its
regrettable "bubble economy" in which asset prices rapidly soared, money supply and credit
underwent sizable increase, and economic activity overheated for a prolonged period (Okina p.396).
At the bubble's peak in 1989, the Japanese stock market obtained a value of around $4 trillion,
reaching the benchmark Nikkei 225 stock average of ¥38,915 (four times the level they had been in
1983) (Siebert p.9). This was approximately 44 percent of the world's equity market capitalization
(Stone p.149). At around similar time frame, Japan also saw a spectacular surge in land prices with
the land values five times that of the United States (Stone p.149). Hence, during this time, the
economy relished an investment and consumption boom to the extent that Japan rapidly became
known as the world's largest creditor country. However, such record growth fell drastically with the
burst of the bubble: the stock market plummeted by over 60 percent from its peak in 1989 to 1992
while speculative land prices fell over 50 percent and essential land prices declined by about 15 to
20 percent (Okina p.397). Overall, the bursting of the bubble resulted in a detrimental decline in
asset prices, the accumulation of enormous

Japan 's Financial Environment : Japan Essay
Financial Environment
When it comes to Japan's financial environment one of the first things to note is the vast pile of debt
that Japan has accumulated over the years. Japan's gross debt–to–GDP ratio stands above 240
percent, which is the highest of all OECD countries (The Economist, 2014). In contrast, in 2010 the
ratio was 'only' 178.4 percent. The reason for this huge debt pile is that Japan has had twenty–two
consecutive budget deficits (OECD, 2015). And in recent years these deficits were often over 8
percent of GDP. The main reasons for the rising budget deficits are that government revenues have
been stable as a percentage of GDP, whereas government expenditures have increased steadily (The
Economist, 2014). For now, the burden the debt due to interest payments is limited due to the low
interest rates at which Japan is able to borrow. However, an ageing population will make repaying
debt in the future ever harder (OECD, 2015).
The Nikkei 225 Stock Average is Japan's most important stock index. The Nikkei 225 index
declined as a result of the Global Financial crisis and hit a low in February 2009. It was only after
Abe took office as prime minister and announced 'Abenomics' that send the Nikkei index up with 57
percent during 2013 (Pattekar, 2015). In 2014 the Nikkei increased with another 5.7 percent and in
June 2015 the Nikkei reached a 15–year high. However, due to economic growth concerns in China,
and the effect of that on exports of Japanese companies caused

Delivering Alpha
Organized by CNBC and Institutional Investor Forums for the third year in a row, the Delivering
Alpha Conference did not disappoint. World hedge fund titans or more commonly known on CNBC
as "Masters of the Universe" descended at the Pierre Hotel in New York City on July 17. Well–
known hedge fund managers such as Carl Icahn, John Paulson, Nelson Peltz, Leon Cooperman and
James Chanos, just to name a few, divulged their sought after stock picks along with solid reasoning
and what lies ahead for stock and bond markets.
The opening remarks by Treasury secretary Jacob J. Lew provided his views on the current situation
of the U.S. economy and regulation post the 2008 crisis. Perry Partners CEO Richard Perry
suggested that Europe is 2–3 ... Show more content on Helpwriting.net ...
While Chris Hohn, Founder of the Children's Investment Fund, suggested buying EADS (Airbus)
which will likely double in price over the next two to three years, as well as buying Porsche now
gets an investor in at a 30% discount whereas Volkswagen will double in two years, and Aurizon
(Australian railroad) will likely double in the next three years due to its more focused approach on
profits.
Legendary short seller Jim Chanos, Founder of Kynikos Associates the largest exclusive short seller
in the world, presented his views on why Caterpillar, due to accounting issues and the lack of
growth, is a short as well as his older short HP is still in place. Mark Kingdon, President of Kingdon
Capital Management, suggested going long the following Japanese stocks with low PE ratios
(Mazda, Fuji Heavy (Subaru) and Toyota as well as a pharmaceutical firm called Aegerion will have
good returns over the next 12–18 months. When it comes to Powering America the panel suggested
that natural gas is cheaper and investors should include natural resources in a portfolio for protection
against an inflationary environment with a panelist suggesting a long position in Whiting Petroleum.
Activist investor Nelson Peltz was asked about his long position in DuPont and did not comment,
but discussed his stakes in Pepsico and Mondelez and suggested two scenarios for Pepsico to follow.
During the luncheon speech John Paulson suggested the best investment now is buying a

The Effect Of Bubbles And How They Affect Investment
2. The definition of bubbles and how they affect investment This section will focus on the analysis
about how bubbles affect investors' behaviors. Since bubbles are closely connected with crises,
doing research on investors' behaviors about overvalued assets can help economists to understand
crises' fundamental. Therefore it is good for governments to take actions to prevent these crises. The
first part of this section will describe the definition of "bubbles" in detail, and the second part will
illustrate relevant empirical evidences to further explain how bubbles affect investing behaviors. 2.1
Theoretical research C. Kindleberger (1978) first defined "bubbles" as a continuously increasing
process of assets' price. This phenomenon ... Show more content on Helpwriting.net ...
Finally he found investors' behaviors in terms of the overvalued assets played an important role in
this process. Joesph E. Stiglitz (1990) agreed with the theory above, and suggested that if investors
thought assets could be sold over their expectation, they would do more investment, and then assets'
actual price would increase, which also means the bubbles would appearance. He thought it is
important to prove the existence of bubbles, since they can implicate the future decrease of assets'
price. Therefore governments could take actions to control investors' behaviors and avoid crises. But
by taking the 1960s crisis as an example, he found bubbles' existence was difficult to test. It is
because bubbles would not exist only if the assets' discount rate increased equal to the assets' price,
which means the assets' value would be equal to the discount value. But this equilibrium is not
expectable. Then Stiglitz proposed that the markets might have multiple equilibriums, so he
collected many economists' thoughts about this opinion. But he found models of different
economists were developed in terms of different methods, so they cannot reach an agreement. But
he suggested that it is still important for economists to analyze this problem in further studies.
Basing on the research of other economists, Robert S. Chirinko and Huntley Schaller finally built a
widely accepted model, Q equation, to test bubbles' existence. The

The Disaster Of Space Shuttle Columbia Disaster
Abstract The fragile of complex and large systems, it is argued, is addressed through the
catastrophic events that happened in different fields. This report looks at three serious systemic
failures in engineering and finance domains among the history, including the Disaster of Space
Shuttle Columbia in 2003, the Japanese asset bubble in late 1980s and the explosion of Deepwater
Horizon in 2010. The research draws upon final reports of NASA, related magazines and published
books. Looking through the lenses of those catastrophes, the analysis reveals the tremendous loss
and effect of system failures and gives a lesson to avoid similar disasters in the future.
Space Shuttle Columbia Disaster On February 1st, 2003, Space Shuttle Columbia was destroyed on
its way re–entering Earth and all 7 crew members died in that accident. Space Shuttle, different from
the one–time–used rocket launcher or manned spacecraft, is a partially reusable low earth orbital
spacecraft system operated by the United States National Aeronautics and Space Administration
(NASA). Each space shuttle may bring different missions leave and re–enter Earth several times.
Since the final flight of the Space Shuttle Columbia is the 113th flight of the Space Shuttle Program
and Columbia's 28th mission, we will refer 'Space Shuttle Columbia' in its final flight as 'STS–107'
in the later passage. STS–107, carried equipment and 7 crew members, was launched on January
16th, 2013 and was expected to stay in space

Dystopian Anime
Japanese Anime is different from traditional cartoon. Cartoon is more suitable for children to watch
whereas anime is more for teenage or adult viewing. The anime genre can be very wide from
comedy, to cyberpunk, to super robot. Many of the science fiction anime share the same idea of
dystopia.
Dystopia is describing an imaginary universe which is opposite with the Utopia society, it shows the
illusion of a perfect condition society. In fact the society is controlled by the government in different
way including propaganda, information thought and freedom. In the Dystopia world, citizen are
usually under surveillance and lived in a dehumanized condition inside the dystopian society. Most
of the dystopian Japanese anime are based heavily on a science–fiction setting. For example, Akira,
Metropolis, Eden of the East, Code Geass, Psycho–Pass.
The film Akira is one of the most famous Dystopia animation in Japan. It was ... Show more content
on Helpwriting.net ...
The stock market prices increased rapidly and erupted in 1990. This caused the biggest loss of
wealth in Japan. This estate bubble also leaded to severe financial crisis and the period of economic
stagnation which called "Lost Decades". We can see there are certain connection between the crisis
and the background of Neo–Tokyo. The Neo–Tokyo seems to be very flourishing and modern which
is similar with the blooming economy from 1986 to 1990 in Japan. However, the Neo– Tokyo
government is secretly conducting human experiment, the state is full of protesters against solider
and the education system is corrupted. The city is remaining unstable. This background gives us a
hint of the horrific human evolution in the future. Simultaneously, Japan is also transforming from
"Classical" or "Traditional" cultural to a more "modernised" cultural of economic and business
condition. Some of the scenes appeared to be bloody, violent and terrifying (Tetsuo is assaulted by
massive toys in the hospital

Examples Of Housing Bubble In Australia
Housing bubble in Australia
With the consistent increase of property prices and more personal debt than ever before, we assume
that there's a housing bubble in Australia. The statistics show that from 2008 till now, property
prices have been going up as a result of increased mortgage debt. When it slows down, that could
cause a property crash. We are sure that there's a housing bubble, but we cannot confirm when it will
finally burst although a few area in Australia has already met a decrease of house prices. There are 3
indicators of the housing bubble in Australia.
First of all, from 2008 to 2015, property prices of all capital cities in Australia have increased
rapidly. People have had obsession with buying houses. At the same time, ... Show more content on
Helpwriting.net ...
This is a sign that the housing bubble starts to burst. Secondly, in the past few years, household debt
has increased rapidly. On one hand, it has deep influence on each Australian. With one dollar earned,
one Australian is now in debt for two dollars. Australia's debt for property is just lower than
Switzerland in the whole world and doubles as much as America. Compared with the increase of
house debt, salaries of Australians have remained steady, which means people's capacity to repay
debt hasn't improved. Australians have been recorded low wage growth. From January to March
2017 wages grew just 0.5 percent. Over the previous year, wages grew a total of 1.9 percent. From
2011–2016 wages grew just 13 percent (Anderson 2017). Considering price to income ration index,
housing affordability in Australia has broadly declined in the past few years. Nevertheless, it's very
easy for anyone to get loans from the bank. People don't need strict assessment of credit to get loans
and the government has some policy like first home owners scheme to encourage house loans. As
the interest rate is at the lowest point in history, any boost of the interest rate would cause hundreds
of thousands of households under mortgage depress. In addition, the ease to get loans make more
house demand, which eventually make the price going up. If people can only use their incomes to
buy properties, the demand would definitely not as high as nowadays. The American house crash

Shintaro Ishihara's Summary
Shintaro Ishihara's argues that Japan has the ability and will become first among equals. His mindset
was created through the positive economic turn in Japan after the war, also known as the economic
miracle. In addition, the bubble economy only influenced Ishihara even more to think that Japan
could fully compete against the West, especially America. Japan's economic miracle ignited
Ishihara's argument that Japan's technological advancements could potentially lead to more
independence from America. Specifically, Japan's technological work on the microchips used in
America's entire nuclear arsenal. America is dependent on Japanese microchips, "without it the U.S.
Department of Defense cannot guarantee the precision of its nuclear weapons". ... Show more
content on Helpwriting.net ...
Nonetheless, the 1990s was the start of a new American policy in Asia, specifically focused on
Japan, and an unrelenting period of competition "between free–market capitalism and non–capitalist
market". However, the 1990s is dubbed as Japan's lost decade, a time "the powerful and privileged
lost while the ordinary people benefited". The lost decade was a "period when the economy
imploded, the asset bubble collapsed, banks teetered on the edge of insolvency, unemployment
skyrocketed, suicides increased and the leaders of Japan, Inc. were tarnished by exposes of
pervasive corruption". The lost decade encompassed the loss of money, security, stable families, and
the credibility of the nation's leadership. Again, a part of the lost decade is corruption and "the vast
majority of postwar prime ministers have been implicated in corruption scandals". In addition, the
corruption involved the Yakuza, a major gangster organization, they manipulated "bankers and
bureaucrats to secure huge loans for speculative and illegal activities". Therefore, this asset bubble
"may have been a giant con game that enriched the mob at public expense", a partial reason for why
the bubble

Cause Of The 2008 Financial Crisis
Causes of the 2008 financial crisis
Financial crisis has been prevalent since time immemorial. The world's economies have been
continually hit by the same and the 2008 financial crisis is definitely not the last appearance. The
financial sector involves complexity and contains one of the world's largest players and has
continually developed into large conglomerates sometimes too big to control. These financial
organizations have developed products that have become hard to regulate and impose control on
which has often led to their collapse. Major world governments and financial institutions, mostly the
central banks have the responsibility to make sure that these organizations are operating both
ethically and legally and within the bounds of the law. This is the institution of supervisory and
regulatory roles to monitor them.
Supervisory and regulatory structures have in the past failed to control the activities of these
enormous companies dealing in financial solutions especially where these organizations have
become larger than the country's individual economies. The financial companies engage in risks too
large for them to handle in a bid to generate more profits and when these ventures have gone
haywire, these companies have sunk.
Foster & Magdoff (2009) wrote that the failure of the international financial markets in 2008 led to
the World's worst economic nightmare, with a dip in the market performance that led to the eventual
failure of companies operating therein.

Essay On Japan Labor Shortage Advantages And Disadvantages
Challenges that created by country characteristics:
1.High land prices
Japan is an island country(see in figure 1), the land area is only 378,000 square kilometers. Land is
in short supply, especially in the business district in Japan. And the price is absolutely the most
prohibitive all around the world. This is one of the major obstacles to business expansion in Japan.
Possible measures to deal with shortages include open stores dedicated to delivery, the establishment
of standard stores in lower rental areas, or the development of more profitable shops with smaller
kitchen areas.
Figure 1
2. Labor shortage and Japanese labor practices
Because of the lack of young workers from structural rather than temporal changes, including the
decline in the birth rate of Japan, labor shortages for the fast food industry becomes a serious
problem. Fast food industry mainly relies on high school graduates and college students part–time
staff. Half of the full–time employees, including the managers, are college graduates.
Therefore, management must provide them with the benefits of Japanese employment practices,
such as the seniority system and the lifetime employment system. Management must also be
concerned about the increase in salary levels and prevent them from leaving to ensure the future
potential of employees. In order to address labor shortage challenge, Kentucky Fried Chicken is
attracting working conditions by developing a new system, getting rid of "dirty, dangerous, hard

Behavioral Finance
Behavioral Finance
Jay R. Ritter
Cordell Professor of Finance
University of Florida
P.O. Box 117168
Gainesville FL 32611–7168 http://bear.cba.ufl.edu/ritter jay.ritter@cba.ufl.edu
(352) 846–2837
Published, with minor modifications, in the
Pacific–Basin Finance Journal Vol. 11, No. 4, (September 2003) pp. 429–437.
Abstract
This article provides a brief introduction to behavioral finance. Behavioral finance encompasses
research that drops the traditional assumptions of expected utility maximization with rational
investors in efficient markets. The two building blocks of behavioral finance are cognitive
psychology (how people think) and the limits to arbitrage (when markets will be inefficient).
The growth of behavioral ... Show more content on Helpwriting.net ...
This is especially true when one is dealing with a large market, such as the Japanese stock market in
the late 1980s or the U.S. market for technology stocks in the late 1990s. Arbitrageurs that attempted
to short Japanese stocks in mid1987 and hedge by going long in U.S. stocks were right in the long
run, but they lost huge amounts of money in October 1987 when the U.S. market crashed by more
than the Japanese market (because of Japanese government intervention). If the arbitrageurs have
limited funds, they would be forced to cover their positions just when the relative misvaluations
were greatest, resulting in additional buying pressure for Japanese stocks just when they were most
overvalued!
2. Cognitive Biases
Cognitive psychologists have documented many patterns regarding how people behave.
Some of these patterns are as follows:
Heuristics
Heuristics, or rules of thumb, make decision–making easier. But they can sometimes lead to biases,
especially when things change. These can lead to suboptimal investment decisions.
When faced with N choices for how to invest retirement money, many people allocate using the
1/N rule. If there are three funds, one–third goes into each. If two are stock funds, two–thirds goes
into equities. If one of the three

The Recession Of The United States And United Kingdom
The Great Recession of 2007–2012, of which several countries are still recovering, including the
United States and United Kingdom, shows great similarity to the Japanese Recession of the 1990s.
However, by taking a closer look and identifying the causes of both we become aware of the
differences that make them not so similar after all. The Great Recession had a domino effect
beginning in the United States with the fault of subprime mortgages creating a housing bubble.
Whereas Japan's fault lies with the increasing land prices due to investment, in which created a land
bubble that eventually would burst. With the United States and Japan holding high ranks on the Top
10 Exporters in 2014, United States 2nd and Japan 4th, a recession shows ... Show more content on
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The risk was extremely high due to the possibility that the loan would never be paid back. During
the 2000s a housing price bubble was beginning to form within the United States. This was due to
those who before could not own a house, suddenly being able to due to subprime mortgages. Prices
rose 90% from 2000 to 2006 (Ueda, 2012) showing a rapid increase in housing prices and therefor
increasing the amount further of those who would never be able to pay their mortgage back. This
caused great financial pressure within the United States economy when the federal reserve raised
interest rates within the United States in February 2007.This meant that debts were not being paid
by subprime mortgage holders resulting in the collapse of the subprime mortgage market in mid
2007. A prime example of this is the largest sub prime lender firm within the United States, New
Century Financial. New Century Financial filled for bankruptcy on the 2nd of April 2007. The
collapse came with a cut of roughly 3,200 jobs. (Treanor, 2007) The collapse of the subprime market
meant that the housing boom within United States and United Kingdom came to an end and burst
the housing bubble within the United States. (Arestis, Sobreira, and Oreiro, 2010) However, this did
not stop the spread of the subprime mortgage. In the United Kingdom, Bank Northern Rock began
to target sub–prime customers. Northern

Zombie Industry : Zombie Lending And Depressed Restructuring
Finally, some other possible causes will be discussed in this section. First of all, Hoshi and Kashyap
(2011) demonstrate that there are three primary causes of the long recession in 1990s. One of them
is "Zombie lending and depressed restructuring". The lax misleading supervisions of the banking
system were extremely serious, but the Japanese government not takes any measure to stop lending
money to zombie firms. Zombie firms are defined as firms are low on production and profit should
exit the market but still continue the business by government's support. They kept recruit labor
supposed be work in regular firms lead to decreasing of production. When the assets price falls,
most banks losses numerous loans and they could try to find new customers, but banks followed the
policy by government and continued to support existing firms. Zombie firms are grown in number in
1990s after the "bubble economy". The most important assumption is that zombie firms obstructed
the growth of regular firms. If zombie firms did not rose, there would be more productive firms,
more investment and employment. The second part is "Government Regulatory Restrictions". One
example is reported that Long–Term Credit Bank LTCB had lending policies with government that
one of the conditions is LTCB must keep supporting small borrowers. Bank owners were forced to
continue leading. Take 1970–2002 as research sample, it can be proved that severer regulated
industries lower productively

U.s. Japanese Government Policies Essay
Introduction The purpose of this research is to evaluate the effectiveness of a set of the recent
Japanese government policies. Before China overtaking the second largest economy in the world in
2011, Japan has kept the position for several decades. However, after the housing bubbles burst in
1990s, Japan had economically struggled where it can no longer grow at such a substantial rate as
previously. In fact, its economy had shrunk when other neigbouring economies, such as Taiwan and
South Korea, had prospered. So Abe Shinzo was elected as the prime minister of Japan and he has
tried to revive the economy under Abenomics; yet, its impacts on the real economy seem ineffective
until recently. This is why I think it will be interesting to evaluate whether Abenomics was the best
option for Japanese government for reviving the economy from the prolonged recession. Was
Abenomics effective? Research questions are as follows: A) Were the uses of monetary and fiscal
policies effective during recession in Japan? B) Will the structural reforms be effective solution for
Japanese economy? I will examine the effectiveness of Abenomics by looking at the historical
economic data in Japan from 1980 to 2015. In addition, I will introduce some of literatures and
relevant books to support my view on Abenomics. Literature review Japan's lost decade Hayashi and
Prescott (2002) conducted a study on Japan's lost decade to provide a new interpretation based on
neoclassical growth model.

The Bubble Economy. The Direct Cause Of The Japanese Banking
The Bubble Economy
The direct cause of the Japanese banking crisis was the collapse of the asset price bubble during the
late 1980s to the early 1990s.
During 1980s, sustained economic growth and low inflation rate were the main characteristics of
macroeconomic environment in Japan. This condition caused the upward growth expectations of
asset prices, uncontrolled credit expansion and financial deregulation.
At the same period, the United States has a substantial increase in the current account deficit and a
sharp increase in the foreign trade deficit. In order to depreciate the U.S. dollar by intervening in
currency markets, five countries including France, West Germany, Japan, the United States and the
United Kingdom signed the Plaza ... Show more content on Helpwriting.net ...
At the same time, these financial institutions may loosen their credit standards in order to get higher
loan market share. As a consequence, their lending decisions were based more on collateral
requirements rather than cash–flow analysis. In order to accelerate credit–check procedures for loan
approval, many banks transferred the responsibility for loan–risk evaluation from their credit–
investigation bureaus to less independent monitoring bureaus reporting directly to the banks' sales
divisions.
The second problem is the defects in corporate governance of Japanese banks. First, because of the
structure of bank ownership, few shareholders own the majority of the total shares, most
shareholders have modest control over the management of banks. Second, shareholders lack of
incentive so it is difficult for them to against managements' decisions. Third, the internal and
external audit was very limited.
Besides, the central bank in Japan has also been criticized for its role in aggravating the bubble
economy. The Bank of Japan used expansionary fiscal and monetary policies to solve the fears of
economic depression. After five rounds monetary easing from January 30, 1986 to May 30, 1989,
the official discount rate

Explaining the Decline of Business in 2007
At the onset of this project we came up with the claim that I could use the logarithmic and/or natural
log to explain the decline in business. The way in which this is to be accomplished is by taking all
the sales figures from a 31 day period in 2007. We would then take another month with the same 31
day period and take those figures. After graphing and comparing the two we postulate that the
graphs would show the direct decline graphically of what we will explain in this paper. After
graphing the figures we saw that the mathematical model that we had previously used would not be
adequate with the explanation. So we then did another 31 day comparative between a 31 day period
in 2007. Then again in 2013. These figures were then compared to the national average for hotels for
the same period. The interesting fact that came about was the direct correlation between the falls in
sales figures both nationally and here in south Florida and the corresponding securitization and real
estate bubble burst. What we will do in the following pages is explain what led up to the bubble
burst as well as some of the mathematical approaches in explaining the bursts. Every economic
bubble in history started with reckless expansion of money supply and credit, reckless manipulation
of interest rates, or government promotions of "low–risk" something for nothing schemes. We saw
this happen during the Reagan administration with the low interest rates given. Hence the new
popular movie Wolf on Wall

Advantages Of East Asian Development Model
The so–called East Asian Development Model was devised as a reaction to sustainably high growth
rates in many East Asian countries in the post–World War II period and particularly in the last 40 to
50 years. Generally, there are two competing models of economic developments for developing
countries: On the one hand import–substitution industrialisation (ISI) and on the other hand export–
led industrialisation (ELI). Many Latin American and African countries favoured the former after
the Second World War and erected trade barriers, introduced tariffs and tried to promote local
industries. In the first couple of decade particularly South Asian (India) and Southeast Asian
countries (Indonesia, Malaysia, Vietnam) also applied this model to a certain extent. A big exception
from the very beginning on, however, was Japan, which was quickly integrated in the world
economy thanks to American support and advocacy and also pursued very active government
policies to promote internationally competitive industries. This resulted in very high average growth
rates of 9 % from 1953 to 1965, with the economy gradually slowing to a growth rate of 7–8 % in
the 1970s and further slowing to around 5 % in the 1980s – which, it should be noted, was still far
above the rich–world average, thus inspiring the ... Show more content on Helpwriting.net ...
But admittedly even in such a position it is not easy to restructure debt from one sector to the other
without creating distortions for the economy, therefore it still remains to be seen how Japan will deal
with its debt issue. Depiction 12 shows the huge shifts in debt position between the different sectors
following the bust of the bubble economy in

The Economic Crisis Of Japan
Introduction Japan enjoyed an Asia's economic miracle that the world witnessed a country that
started out poor and had become the second–largest industrial power during the postwar era.
However, a large bubble economy had been irritated by the growth, especially in the stock and asset
price markets, the economy suffered a near catastrophic crash caused by speculative mania(Hall and
Von Wiesen, 2014). The Japanese economy has stagnated after the collapse of bubble economy. The
economic situation has been in a wide deflation. In the last two decades, Japanese government took
several measures to solve the deflation problem and spur the economy. There are fiscal expansion,
conventional monetary measures, Yen depreciation, bank recapitalisation, Quantitative Easing, and
three arrows of Abenomics. But the situation did not change much, the balance sheet of the country
shows continuous economic recession. The paper is organized in the following way. Section 2
briefly describes the prolonged deflation in Japan. Section 3 evaluates policies proposed by the
government and gives some reasons of unsuccessful policies. Section 4 summarizes the policy
implementation. Background The long–lasting deflation exert a tremendous influence in Japan, the
persistent decrease in the level of consumer prices shrunk profits and investments in corporate,
wages and consumption in individuals. This leaded to a further price decline. Such vicious cycle has
caused the recovery of Japanese economy to

Abenomics Essay
STUDY OF ECONOMIC POLICY OF JAPAN: ABENOMICS
Keywords:
Abenomics, deflation, aggregate demand, asset bubble, fiscal deficit
Abstract
Shinzo Abe, Prime Minister of Japan, has declared the new economic policy package that proposes a
key role for aggressive monetary easing, expansionary fiscal policy and structural reforms; these
three arrows are described with the term Abenomics. In this paper we discuss the backgrounds of
Japan's economy the factors which flourished it, the period of stagnation and its reasons, the factors
driving to introduce Abenomics and the logic behind it. We tried to reconcile the reasons behind the
weakening of yen against the dollar and rising of stock market since the policy was announced. This
paper makes major points; perhaps the most evident ... Show more content on Helpwriting.net ...
Abenomics takes into account three–pronged approach to re–flate the economy through monetary,
fiscal, and structural policies.
These are also known as three arrows of Abenomics: expansionary fiscal policy, expansionary
monetary policy and structural reform.
The first two arrows act as short term stimulus which aims at increasing the aggregate demand.
While the third arrow focuses on long–term goals and aims to deregulate the economy such as to
increase the economic efficiency.
Dramatically expansive monetary policy– Goal is to end deflation, lead to an increase in prices to an
order of 2% of CPI (around 1% of GDP inflator).
Fiscal stimulus– The Bank of Japan (BoJ) has two goals which include keeping Japanese
government bond yield lower than 1%.
Long run growth strategy– This is a complete package in itself. It includes industrial reforms, labor
market reforms and IT innovation. The government is also looking forward towards new market
growth and

Is Japan's Stagnant Economy?
Something having no current or flow and often having an unpleasant smell defines the word
stagnant. The Japanese economy has been stagnant for about two decades now. There are many
reasons for this 'unpleasant smell'. Firstly, the fiscal policy in Japan, the surplus in savings, its once
economic bubble power and the policy management in Japan put an end to any flow that there once
was. Secondly, the Global flow and structural impediments are a cause of the lack of current. The
liberal Democratic Party and Vested Interest Groups and also the monetarist explanation come into
play. Looking at these such topics closely give a better look and realization of Japans stagnant
economy. Firstly, in 1997, Japans fiscal policy was causing output in ... Show more content on
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It would, in effect, offset deflation, by constructing an anticipation of escalating prices. Cutting
public works could make up the immediate revenue loss, and the upcoming tax escalation would put
Japan's finances on a sturdier path. It is neither too late nor too expensive for Japan to revitalize its
economy by pursuing proper fiscal expansion, financed by the Bank of Japan buying government
bonds. A world–class manufacturing power was lead into a deep slump. Japan has traditionally
possessed a remarkably high savings rate and a moderately low consumption rate. Throughout the
previous two decades of recovery and high–speed growth, this 'savings surplus' provided greatly
needed capital to private industry in the form of bank loans. This money was used to build and
expand Japan's industrial infrastructure power. However, during the 1990's the 'savings surplus',
once the essential fuel for high–speed development became a stern obstruction, leading to a severe
collapse in demand and causing a heavy drag on Japan's economic recovery. The so–called
powerhouse country that was known to be Japan, known to be unstoppable was known never to fall.
Japan seemed to be unstoppable after there amazing recovery post World War II compared to the
rest of the effected countries. Japan had an economic bubble in the 1980's to the later part of the
decade however; an insidious cancer took root and metastasized in Japan's economic infrastructure.
The cancer was vastly over–inflated

Zombie banks
What are 'zombie banks'
The term 'zombie bank' was first introduced by Edward Kane in 1987 to describe a bank that has a
negative net worth but still continues to operate. A negative net worth means that the fair value of
assets is lower than the total value of liabilities. Zombie banks usually have large amounts of non–
performing assets on their balance sheets making them unprofitable. A loan is considered to be a
non–performing asset if no principal payments or interest have been paid for 90 days and is
therefore seen to be in jeopardy of default. The fair value of an asset that is considered non–
performing is considerably reduced. Zombie banks usually continue to operate until their financial
situation is resolved or they are run ... Show more content on Helpwriting.net ...
As a result, Japan went into a prolonged period of deflation that lasted for most of the 1990's. In
order to boost demand, the Japanese government took a Keynesian approach and went through 10
fiscal stimulus packages in 1990's totaling over 100 trillion yen (10). However, this didn't have the
desired effect on demand because of deflation. Consumers were putting–off purchase decisions
because prices were falling. The real GDP stagnated and average growth between 1990 and 2001
was only 0.37% (12).
The European debt crisis began in 2009 when rating agency's downgraded Greek government and
bank debt because Greece's government debt reached 113% of GDP. Furthermore, in 2010 Greece's
budget deficit for 2009 was revised from 3.7% to 12.7% (13). Since then Greece has received
multiple bail–outs and the crisis has spread throughout the Eurozone and many countries like
Portugal, Spain, Ireland and Italy have been severely affected. The Eurozone crisis is a combination
of sovereign debt, productivity, private debt, asset bubble and banking crisis. Contrary to BOJ in
1990's, the ECB reacted to the crisis by quickly lowering the interest rate to 1% in May 2009 (14).
Furthermore, the ECB started intervening with the securities market directly in 2010 with the
'Securities Markets Programme', purchase programme to buy bank–issued covered bonds (2011)

The Current Policy Rate Of The Central Bank Essay
On the other hand, the ZLB is a global phenomenon, "The main policy rate of the central bank is
currently at zero (or close to zero) in 22 out of 34 OECD countries" displays the worldwide struggle
of central banks since the global financial crisis (Wiederholt, 2015, 1). At the ZLB central banks
must look at unconventional policies, however Japan shows us it remains extremely difficult to
stimulate growth and inflation. In 1999 the BOJ introduce Zero Interest Rate policy (ZIRP) when it
lowered in the interest rate to virtually zero. The BOJ also incorporated future policy statements
indicating the rate would remain lower for longer this "is to lower future expected interest rates and
thereby boost spending immediately" and cause reflation (Williams, 2014, 6). However, expected
inflation will only increase if the bank credibly commits to its policy and it is merely not
transitional. The BOJ stated ZIRP would remain until "until deflationary concerns disappeared"
which is too vague and does not give private agents enough information, therefore casting doubt on
competence of the BOJ (www.boj.or.jp, 1999). Setting an inflation target would help quantify the
BOJ objectives. Krugman (1998) argued for the BOJ to "credibly promise to be irresponsible" and
not reverse ZIRP once inflation increases plus set an inflation target higher than desirable. Bernanke
(1999) agrees by setting an inflation target of 3–4% would highlight the movement of BOJ away
from a deflationary regime.

The Role Of Production And Employment On Australia 's Economy
Part A The roles of production and employment in Australia's economy is crucial as they are in an
interrelationship with all sectors and this is the basis of how money and resources are distributed
throughout a country. This is because employees help make the goods and services which we as
consumers use and then they get paid to do so but then the employees buy these goods and services
with the money which they earned. Not only do workers help one another via supplying each other
with money and resources but they also help the Government's budget by giving them their taxation
income. With this money, the Government can then use it to support the people of the nation by
providing benefits such as welfare benefits and public services. All ... Show more content on
Helpwriting.net ...
The video game crash peaked at around 3.2 billion dollars in 1983 and then fell to approximately
100 millions dollars by 1985 and this caused one of the major companies of the time (Atari) going
from 10,000 employees in Silicon valley to less than a thousand in six months. Some of the key
sectors in Australia is retail, fishing, education and training, construction and transport. In 2016, the
retail market in Australia is currently in a downfall state with self–service checkouts taking over
human workers due to them having a better return on investment whereas in the 1990s, it was a
flourishing and rising employer due to the increases in the amount of shops being opened and
because there were more spenders. This is shown by retail trades' employment increase of
approximately 18% from 1989–1999. Another example is in the transport sector; this sector is on the
brink of being taken over by artificial intelligence (self–driving vehicles) within the next few years.
Currently, there are already some cars on the road which are fully automated such as Google's self–
driving car which can drive relatively safely as shown in the many test trials for the car. Meanwhile,
in the 1990s it was a fully manual service with human drivers driving the car; it was also a
increasing employer (from 1989–1999 it increased

Tutorial 4 Notes Essay
Business in Asia Tutorial Program Semester 2, 2014 Guide Notes Tutorial 4: Japan: Changing
business environment – growth, stagnation and Abenomics 1. Outline very briefly the main factors
that led to the bubble economy of the 1980s and its crash? The appreciation of the Yen following the
Plaza Accords under US pressure and the policy responses.  Japanese industries lost international
competitiveness and the economy slowed. The government loosened monetary policies to counteract
this and stimulate the economy.  The supply of money expanded, this money was invested in
domestic assets (real estate and stock market) whose prices went up; as their prices went up people
invested more funds, prices went up even more, then people invested ... Show more content on
Helpwriting.net ...
(b) Japanese investors do not see any better investment options. In theory they could invest in
foreign markets. But in practice there has been strong 'home bias' in investment, and many large
pension funds etc have been managed by bureaucrats who have been very conservative.
International conditions have been very volatile and Japanese yen has been seen as a 'safe haven'
currency – because Japan as a country is not an indebted country, say like the US. So, the currency
has tended to be quite strong, often appreciating; this reduced the attraction of investing abroad. 4.
Why is the Japanese government in debt, but Japan is a net saver? Recall national income accounts.
National savings are not the same as government savings. National savings = private sector
(households + corporates) savings + government savings. Household and corporate savings have
been, until very recently, consistently higher than government borrowings, though household
savings have been coming down in line with demographic trends (aging population). Corporations
(firms) have overall – some have invested in foreign countries through FDI – felt that investment
options in Japan are poor, so they have been saving rather than investing. 5. Why have corporate
savings increased in Japan, and what does it indicate about business expectations?

Case Study
Introduction In this case we get an entire scenario about how the Japan deflation set in, what were
the effects of the deflation on the economy as well as on the people of Japan. It also mentions about
the various reasons because of which Japan was in such a tight grip of Deflation, Depression,
Demographics and Debts Guides us through the steps taken by the government in order to curb this
deflation. Imparts a great knowledge to us about the various economic terms like deflation, self–
liquidating credit, Non–Self Liquidating Credit and how the people and economy of a country is
affected by these. Free markets economies are subject to cycles. Economic cycles consist of
fluctuating periods of economic expansion and contraction as measured ... Show more content on
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A central bank can inject money into an economy without regard for an established target interest
rate (such as the fed funds rate in the U.S.) through the purchase of government bonds in open–
market operations. This is when a central bank purchases a bond, in which case it effectively
exchanges it for cash, which increases the money supply. This is known as the monetization of debt.
(It should be noted that open–market operations are also used to attain and maintain target interest
rates, but when a central bank monetizes the debt, it does so without regard for a target interest rate.)
In 2001, the Bank of Japan began to target the money supply instead of interest rates, which helped
to moderate deflation and stimulate economic growth. However, when a central bank injects money
into the financial system, banks are left with more money on hand, but also must be willing to lend
that money out. This brings us to the next problem Japan faced: a credit crunch. Credit Crunch A
credit crunch is an economic scenario in which banks have tightened lending requirements and for
the most part, do not lend. They may not lend for several reasons, including: 1) the need to hold onto
reserves in order repair their balance sheets after suffering loses, which happened to Japanese banks
that had invested heavily in real estate, and 2) there might be a general pullback

JAPAN’S ANNUAL MONEY SUPPLY GROWTH RATE
JAPAN'S ANNUAL MONEY SUPPLY GROWTH RATE
In November, Japan's industrial production increased output of cars for foreign customers. However,
the nation's retail sales continued to fall. The output of Japan's factories and mines gained
significantly. The output will reinforce expectations that recover in overseas demand. The various
efforts could help prevent Japan's economy from going back into recession of growth.
The works of the U.S. and China will continue the upward trend in output thanks to the demands.
Manufacturers are expecting their output to rise 3.4 % in December. However, other data shows that
Japan's domestic demand remains weak. This will keep the nation's recovery vulnerable to
slowdown in overseas growth. ... Show more content on Helpwriting.net ...
Like the rest of the world, Japan has in fact been experiencing inflation. The Bank of Japan
increased its annual inflation rate to 1.8% from 1.1%. Japan will increase in consumer prices (goods
and services) which should lead to higher company profits and wages, and domestic spending in the
economy. Japan's increase is mainly imported and increasing food and energy prices. Japan is an
importer of goods and Japanese companies are not benefitting from this inflationary environment. In
1992, stocks fell, and real estate and assets were affected and they call this the," Bubble Burst". How
this came about is the financial system was dominated between politician, financial institutions, and
regulatory authorities and they limited bankruptcy. Regulatory and market innovations subsidized
risk taking from both financial institutions and their business clients. Monetary policy focused
Japan's yen appreciation and high GDP growth rates, low inflation rates, and made asset values
increase. Increased monetary growth led to increased bank lending.
This increased the demand for land, real estate, and equities. During the time of the Bubble Burst
low interest rates led to rising asset prices. The bank of Japan raised the discount rate with tight
monetary policy for four years. The decline in the assets prices weakened bank balance sheets,
investments, and consumption

The Impact Of The Plaza Accord
The Plaza Accord or Plaza Agreement was the agreement, which signed in 1985 at Plaza Hotel in
New York City, among the G–5 nations which included France, Germany, the United States, Japan,
and the United Kingdom agreed to operate exchange rates by depreciating US dollar relative to the
Japanese yen and the German Deutsche mark. The objective of the Plaza Accord was to correct trade
imbalances between the U.S. and Germany and the U.S. and Japan. Also to help the U.S. improve its
huge trade deficit and to stimulate its economy to climb out of the 1980's long recession.
The United States experienced 3% GDP growth during 1983 and 1984 with a current account deficit
approaching approximately 3–3.5% of GDP, while European nations faced a negative GDP growth
of –0.7% with huge trade surpluses. The same thing happened to Japan. Trade deficits in general
need foreign financing. During the early to mid 80s, for the United States, Japan and West Germany
were buying United States bonds, notes and bills from their surpluses to finance our current deficits
at the expense of their own economies.
In 1985, inflation was low and growth was rapid. Low inflation allowed for low interest rates,
however there was a threat of protectionist tariffs entering the economy. The US was ... Show more
content on Helpwriting.net ...
The impact of the intervention was immediate and within two years the dollar had fallen relative to
Germany Deutsche mark and relative to the Yen. The Us Economy also became geared more toward
exports, while Germany and Japan increased their imports too. This helped resolve the current
account deficits and helped to minimise protectionist policies. However, among the G–5 nations
Japan was badly affected, from the Plaza Accord, by the dramatic rise in the Yen it's exporters
unable to remain competitive overseas and Japan also experienced the economic crisis following the
Japanese asset price bubble during the 1990s called the Lost

lending market and its aftermath reflec Essays
lending market and its aftermath reflects K&A paradigm: format should be to explain the KAM
model, then identify the initial dislocation triggering the bubble,Describe the Aliber–paradigm.
Explain utilizing the housing bubble that has occurred in the past 8 years. Also explain your position
on the bubble housing crisis. Describe the stages of the bubble for the aliber–paradigm. Using the
paradigm to explain problems in stock market and housing bubble burst.
The Leir Center For Financial Bubble Research
Working Paper #1
THE KINDLEBERGER–ALIBER–MINSKY PARADIGM AND THE GLOBAL SUBPRIME
MORTGAGE MELTDOWN
William V. Rapp, The New Jersey Institute of Technology, United States, rappw@adm.njit.edu
ABSTRACT
This paper analyzes the current ... Show more content on Helpwriting.net ...
Further as the KAM paradigm predicts, the subprime mortgage meltdown and its aftermath have
brought numerous civil and criminal actions. For example, mortgage fraud in the US, including
Federal and state prosecution, is growing dramatically. Suspicious activity reports related to
mortgage fraud increased over 1000% between 1997 and 2005 and pending FBI mortgage fraud
investigations rose from 436 in fiscal 2002 to 1210 in fiscal 2007 (Grant, 2008). The huge increases
in the US mortgage market and its increasing complexity have opened many attractive opportunities
for fraudsters across a range of financial activities and institutions. The most common frauds involve
"property flipping" or other schemes to get proceeds from mortgages or property sales via
misleading appraisals or false documentation. The SEC is also looking at insider trading related to
unexpected write–downs by publicly traded companies with assets tied to mortgage–backed
securities. Further plaintiffs' lawyers and their clients have been active in making other claims such
as misrepresentation or failure to disclose materials information, trying to recover some of the
billions of dollars in losses.
However, to grasp the subprime bubble and meltdown in its development, subsequent crash and
current aftershocks, one must first understand the key changes that occurred in the financial markets
for

Review : Annual Economic Outlook
John Greenwood authored an article entitled "Annual Economic Outlook 2013" which provided the
following macroeconomic indices forecast for 2014 for seven (7) leading economies in the world.
The speed at which developed economies can repair their balance sheets is most critical to the
household and financial sectors of the US, Eurozone and UK economies. How effectively the
developed economies can address the problems of government sector debt will also have a major
impact on economic growth.
Although emerging market economies generally have less indebtedness, their inability to decouple
from developed markets undermined their growth rates in 2013 and was expected to continue to do
so in 2014, (Gordon, 2014). The problem for all is that ... Show more content on Helpwriting.net ...
The United States
The US economy was the first to enter recession (2007), and the first to see the effects of the
housing crisis seriously impact the banking system (2008). However, thanks to strong measures to
re–capitalize the banks the US banking system is now clearly on the road to recovery. US
households are also making good progress in repairing their balance sheets. The prospects are for
continued slow growth of personal incomes (about 3% p.a.) at a rate that exceeds inflation and
therefore supports additional savings and further debt repayment. However, US growth depends on
successfully navigating the so–called "fiscal cliff" – the effective increase in a range of taxes (due to
the expiry of several tax cuts enacted previously) amounting to $400 billion, together with automatic
spending cuts amounting to about $90 billion, for a combined total cut in the deficit of close to $500
billion in a single year, (Visser, 2014). The re–election of President Obama feared that a renewed
recession would be enough to enable the two sides in the US Congress to reach some kind of
compromise, although not perhaps to the extent of fully erasing the threat to the US economy.
Consequently there was another year of roughly 2% GDP growth in the US in 2014.
The Eurozone

Swot Analysis : Acadia Realty Trust
Overview of REITS
REITS
REITS is a special company that mainly owns and in most cases operates income–producing real
estate such as apartments, shopping centers, office hotels and warehouses. Some REITS also engage
in financing real estates. The shares of many REITS are traded on major stock exchanges for
example Boston Properties Inc., General Growth Properties, Inc., Acadia Realty Trust ...; on the
other hand, many REITs are public non–listed and private REITs. There are very strict requirement
for a company to qualify as a REIT. The items listed below are some of the basic requirement of
REITs:
Organize as a Corporation, business trust or similar association
Be managed by a board of directors or trustees
Have shares that are fully ... Show more content on Helpwriting.net ...
As a result, their main source of income comes from the interest on these investments or by the sales
of mortgages. Hybrid REITs are a combination of both equity and mortgage REITs.
In 1974, there were an even number of REITs between three types 12 equity, 12 Mortgage and 10
Hybrid; however, in 2006, the number of equity REITs increased to significant number (138) while
there were 38 Mortgage REITs. On the other hand, the number of Hybrid REITs had reduced to only
7. Due to the recent financial crisis, the number of REITs in 2008 reduced to a total of 136 with 113
of them are Equity, 20 are Mortgage and only 3 Hybrid. As of 2014, due to the recovery of the US
economy, the number of REIT increased to 216. Among those, 177 are Equity REITs, 39 are
Mortgage while there are no Hybrid REITs.
REITs offer investors a number of benefits including:
Simple tax treatment: REITs do not pay taxes at the corporate level; only investor's dividends are
taxed as ordinary income, capital gain or return of capital
Diversification: the average performance of REIT has been more or less equal to US common
stocks; however, the correlation of the long term return has been varied. This correlation would
prove to be benefit for investors over the past 20 years; in addition, REITs gives investors an
opportunity to invest in income–producing real estate without owning the actual property
Dividends: Stock exchange listed REITs provide a consistent stream of income to investors due to
one

Macroeconomic Analysis Japan
| |Japan: Macroeconomic Analysis | | | | |Juan Pablo Giraudo | | | ... Show more content on
Helpwriting.net ...
In addition to the causes above, the following events have further deepened Japan's economic
situation during the Lost Decades: 1. Asian Banking Crisis 1997–1998 2. The Dotcom crisis 2001 3.
The Financial Crisis 2008 Macroeconomic Analysis: GDP Japan ranks as the third largest economy
in the world as of 2010. The GDP at current prices in US dollars in Japan was reported at 5068.06
billion in 2009, according to the International Monetary Fund (IMF). Japan's resurgence after World
War II has however reached an inflection point in yearly 1989 after the burst of Japan's asset price
and real estate bubbles. As can be seen from the graph below, Japan's GDP has hovered around the
same level through more than 20 years of economic stagnation. The GDP's slow growth has been
exacerbated by the world financial crisis of 2008. A major landmark of Japan's stagnation has been
the BOJ's fight against deflation. [pic] [pic] However taking into consideration Japan's GDP deflator
and applying a constant price we can see that Japan's GDP growth does not look so bleak. [pic] In
fact until the world economic crisis of 2008 Real GDP has been rising almost every year. There is no
denying that during the Lost Decades Japan's economic growth has stagnated (average annual GDP
Growth was 2.20 percent from 1991 to 2010), unemployment rose from 2.1% in 1991 to 4.7% in
2000 and that generally the

What Is The Role Of Credit And Credit Booms?
The paper concludes the importance of credit to GDP gap, gross external debt to export, and stocks
as variables that can be used in crisis prediction. However, it is the two variables of credit and debt
that stand out to be the most relevant, whereas, it could be inferred that stocks are merely augmented
by their presence or can be used in the presence of credit and debt. Thus, The probability of a
financial crisis incidence in the list of candidate countries increases when the share of domestic
loans in GDP is growing, stock prices are increasing, and the gross external debt relative to export is
rising.
Historical evidence suggests that credit has a constructive role to play in central bank policy and
through modern history; financial ... Show more content on Helpwriting.net ...
It is possible to miss valuable information about macroeconomics and financial stability if
policymakers continue to choose to ignore the behavior of credit aggregates. However, it is unclear
from this study how this information is included in the overall policymaking and regulatory
framework, and via which financial instruments. In terms of policymaking and research, it is safe to
assert that credit aggregates contain valuable information about the likelihood of future financial
crises. However, It is not proven to be a perfect predictor, and this is emphasized by the fact that, in
some periods, especially in eras of financial expansion, development and innovation, credit expands
to support real economic growth. It is important to keep in mind that at the same time, historical
records show that the recurrent occurrence of financial instability and fragility have more often than
not been the result of credit booms gone bad.
There has been a slow growth trajectory noted all over the world since the latest crisis, and one of
the key and largely overlooked reasons for this disappointing growth is the increasing global burden
of debt. Although it is true that low government debt has its benefits and both private and
government debt matter, the main focus should now be on reducing private debt as it is larger than
public debt and has the larger and more direct impact on economic outcomes, and addressing the
issues associated with private debt is necessary

Monetary Policy And Asset Price Developments
Introduction In 2008–2009, the economy financial crisis has been affected in many countries with a
rapidly decreasing in housing prices, follow by a protracted real estate boom. This has created an
interest in the relationship between monetary policy and asset price, and it became a huge debate on
how monetary policy should react to discern deviations of asset price developments. Even before the
financial crisis in 2008–2009 happened there also has been a gigantic debate whether or not central
bank should react and counter to the asset price developments. Proponents of a "leaning against"
begin to argue that the central bank is able to prevent limit of asset price increases (Blanchard 2000,
Bordo and Jeanne 2002, Borio and Lowe 2002, ... Show more content on Helpwriting.net ...
By analyzed the link between financial asset prices and monetary policy is highly important to
achieve a better understanding in the transmission mechanism of monetary policy, as the changes in
financial asset prices is a main role in several channels. We contribute empirical confirmation data
on the relationship between monetary policy and the financial stock market. In the economy, stock
prices are among the most strictly monitored asset prices in the market and stock prices are also
frequently seen as being strongly sensitive to economic situation. Bernanke and Kuttner (2005)
stated that some researchers view the stock market as a separate source of macroeconomic volatility
to which governmental may wish to acknowledge. Stock prices often known as volatility and boom–
bust cycles and leading to the interest about preserved deviations from their fundamental values.
Hence, the authorize quantitatively the continuation of a stock market respond to the monetary
policy changes will not only be significantly related to the study of the stock market purpose but
will also assign to a further research and understanding of the element of monetary policy and
further discussion of the economic impact on stock market. The Taylor Rule Taylor rule has become
the common by which monetary policy is suggested in macroeconomic models in both small and
large. They have been

Japan And The United Kingdom
Japan and the United Kingdom have long been world powers and are now in the top 10 biggest
economies of the world; being third and fifth in the 2014 rankings. (Centre for Economics and
Business Research. 2015) However, both countries have been hit by a great economic crisis that
changed their economies deeply. Though it occurred on different time frames; 1991 to 2000 for
Japan and 2007 to 2012 for the United Kingdom, a lot of similarities can be found between the
causes that started both crises as well as between the development of these crises. However, not
everything is comparable so we can wonder, to what extent are the Japanese recession of the 1990s
and the Great Recession of 2007–2012 similar? In order to answer this question and get a full
understanding of both periods, we will first look at the causes of the Great Recession, then have a
look at the causes of the Japanese lost decade and finally, analyse the similarities and differences
between the two crises. Japan saw its nation change in 1990 when the Japanese economy stagnated.
Indeed, between 1991 and 2003 the Japanese economy only grew 1.14% (of GDP) every year. This
is not enough when compared to other developed countries. (Yuji Horioka, 2006). Alexander, A. J.
(2000) states the facts that from the first quarter of 1990 to the first quarter of 2000 the annual
increase in real gross domestic product per capita barely exceeded 1 percent, making it very clear
that Japan was in a recession. This is all the

Japan Yen
The Rise (and Fall) of the Japanese Yen
Lawrence Cifarelli III, Nazanin Ershad, Natthima Sonsoem, Anyesha Mahaptra
University of New Haven
Abstract
This Case study provides an insight to the fluctuations experienced in the currency of Japan, Yen
from the late 1990's to recent years. Japan follows the floating currency monetary policy due to
which there is no measures taken on to control the fluctuations. Japan experienced magnificent
growth through the 60's, 70's, and 80's leading into the 90's beginning. In the late 1990's, Japan's
economy marked its growth significantly slower, which had then come to be known as the 'lost
decade' due to Japanese Asset Price bubble that collapsed. Eventually the nation faced major issues
regarding ... Show more content on Helpwriting.net ...
For the following issues the Bank of Japan (BoJ) responded by embarking on Quantitative Easing
(QE) in the early 2000's which did little to quell the deflation and Yen Strength that had plagued the
nation entirely.
The major problem for the export–heavy nation became the strength of the Yen. When the exporters
saw a more expensive Yen, they faced more difficulty to compete with domestic manufacturers in
other nations. Also, due to extremely low rates of interest in Japan, it experienced massive outflows
of capital from retirees and investors looking for yield in other economies such as United States,
Europe and Australia.
Subsequently, the Japanese economy maintained a long–lasting recovery beginning in early 2002.
However, the path has not always been smooth, given two "soft patches" (temporary softening in the
market) and weakness in some parts of the economy.
Japan commenced on a multi–pronged approach by June 2012 in an urge to end the multi–decade
slide that was seen in growth numbers for its economy. This approach was initiated by Shinzo Abe
during his campaign for Prime Minister, once installed as the political leader of Japan's economy
with Hiroki Kuroda installed as the head of the Bank of Japan, the country spurred into putting
effort in order to inculcate inflation consequently inflation back to the nation.
The current Japanese bond market bubble has contributed greatly to the fluctuation of the

A Random Walk Down Wall Street Book Analysis
Introduction to "A Malkiel Random Walk Down Wall Street" If you are a new investor who is
interested in investment history or how to make investments, purchase this book by Burton G.
Malkiel. This book is ideal for any experienced investor who wants to brush up on their knowledge
of investment techniques and theories also. There are not many books that have been written about
investing. A Random Walk Down Wall Street is broken down into four parts which include; Stocks
and Their Value, How the Pros Play the Biggest Game in Town, The New Investment Technology
and A Practical Guide for Random Walkers and Other Investors. In total, there are fifteen chapters
that cover a lot of key points that many will find interesting and informative. ... Show more content
on Helpwriting.net ...
He is also an economist that specializes in securities markets and investment behavior. In addition to
these qualifications, Burton Malkiel has been a lifelong investor.
The South Sea Bubble
Throughout the text of the book, you will read about different bubbles that occurred in history. Some
of these bubbles have happened in the last ten years and some have happened in the last three
hundred years. One of the most interesting bubbles that I read about was "The South Sea Bubble".
The South Sea Company in England was formed in 1711 to create confidence in the government's
ability to meet its debts and promises. This company took a government debt (IOU) for ten million
pounds. In return, the government was given monopoly over all trade to the South Seas (Malkiel,
Page 41). People thought there would be a lot of opportunity to make money during this time. In
1720, the entire national debt, which was thirty one million pounds, was capitalized. The stock rose
from 130 pounds to 300 pounds when the bill was introduced to Parliament. After bill became the
law, the South Sea Company sold a new issue of stock at 300 pounds. There were fights that broke
out by investors who wanted to purchase this new stock price at a proposed installment offer.
(Figure 1) Figure 1 is an image of what a stock certificate looked like when issued to investors.
South Sea Company reissued a new stock price of 400 pounds. The stock eventually rose to 1000
pounds.

Bitcoin Essay
Bitcoin, A Bubble or Good Investment? Cryptocurrency is a digital asset that serves as a medium of
exchange with no central authority and was created to prevent the issue of double spending. This
problem is solved with the use of blockchains where miners confirm transactions on a public ledger.
As of today, there are over 1,000 different types of cryptocurrencies, and at least 600 of these have
listed market caps of over $100,000. Bitcoin, Ethereum and Litecoin are top cryptocurrencies
trading today with their combined market cap topping $331B. Bitcoin, created in 2009, is the
biggest cryptocurrency and has recently reached a net value of over $270 billion, with much of its
growth being in the last few months. This has led to much ... Show more content on Helpwriting.net
...
However, in both cases the investment vehicle was not expected to generate revenue for the investor
through dividends or interest. The value of the asset is based off speculation on what people believe
it will be worth and once that confidence in the cryptocurrency wavers, the market cap declines,
hence the volatility of the currency.
The mystery of what cryptocurrency really is and what the future holds for it is another trait of
Bitcoin that resembles the buildup of the Tulip mania bubble. A sense of mystery was created from
the colors being unknown for the tulips that were cross bred which assisted in pushing up the values
of tulips. With the U.S Securities and Exchange Commission (SEC) and Commodity Futures Trade
Commission (CFTC) taking opposing views on whether Bitcoin is a commodity or security, the air
of mystery due to weak regulations has contributed to its price instability. It can be expected that the
bubble will burst as Bitcoin will increase in the near future. When? That's the million dollar
question. As the Bitcoin market surges, it has attracted increased public attention and everyone
wants a piece of the pie. As a result, the market value of Bitcoin increases exponentially. There are
approximately 16 million bitcoins in circulation today from a total of 21 million. With 5 million or
less left to be mined, it makes Bitcoin mining very competitive

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