Japan's Debt to GDP Hits 400%!

Incredible! Over at Zerohedge, I just read an article entitled: This Is The Biggest Problem Facing The World Today: 9 Countries Have Debt-To-GDP Over 300% (www.zerohedge.com/news/2015-02-23/biggest-problem-facing-world-today-9-countries-have-debt-gdp-over-300)

Here's the chart from that article showing the top 16:

It doesn't comfort me at all that the USA is 16th with debt at 233% of GDP.

There's only one way out of this mess, folks; the governments and central banks must create inflation. The way they will do this is by depreciating our currencies by more printing. 

It's the only way out for them.

Got gold? Silver?

6 Minute Animation Simply Explaining Japan's Debt

Here's an excellent short animation concerning Japan's ticking debt time bomb.

Thanks to Peter Dyloco for the tip!

Stocks Will Go Higher if We Keep Printing Money

Today the Dow surpassed $14,000. The crowd cheers. The Fed is buying $85 billion a month, about what the US fiscal deficit is, so then stock prices do and will continue to go up. 

Everyone cheers...

But, the cheering actually means nothing.... As Kyle Bass says, "Zimbabwe's stock market was the best performer this decade - but your entire portfolio now buys you 3 eggs." 

Is there any wonder as to what is going to happen in the USA?

Please refer to Zerohedge and Kyle Bass Tells 'Nominal' Stock Market Cheerleaders: Remember Zimbabwe  

Amid the euphoria of today's crossing of the Dow's Maginot Line at 14,000, Kyle Bass provided a few minutes of sanity this morning in an interview with CNBC's Gary Kaminsky. Bass starts by reflecting on the ongoing (and escalating) money-printing (or balance sheet expansion as we noted here) as the driver of stock movements currently and would not be surprised to see them move higher still (given the ongoing printing expected). However, he caveats that nominally bullish statement with a critical point, "Zimbabwe's stock market was the best performer this decade - but your entire portfolio now buys you 3 eggs" as purchasing power is crushed.

Now Japan's stock market has been climbing higher and higher in the last two months also. The Japanese government has been printing and printing.The currency war has begun and we (the people) will be the losers.

Is there any wonder as to what is going to happen in Japan?

For the Keynesians out there who think this is good fiscal policy, then let me ask the tried and true question, "If government's can create wealth just by printing money, then why are there still poor and starving people in the world?"

The answer is obvious; you cannot fix a debt problem by creation of more debt.

PS: The Japanese stock market has gone way up in January 2013, right? WRONG! It has flatlined against the US dollar:

How Much Has the Japanese Stock Market Risen in January 2013?

There is a rising roar of bulls stampeding to the Japanese stock market. Whether due to Abe's apparent "this time it's different" cratering of the JPY to aid exports (and avoid deflation) or just plain old momentum (as the Nikkei 225 is nominally up almost 8% in January). However, just a little reminder that this return is priced in those increasing worth-less JPY. For all those exuberant overseas investors eying the gains, the reality is that, in USD, Japan's stock market is almost perfectly unchanged since 12/28

Great work, Abe... Deeper in debt and nothing to show for it except the destruction of the purchasing power of the yen.

Japan Debt Now 237% of GDP!!!

It has come without much fanfare. In fact, it wasn't even headline news that I saw. Bloomberg now reports that Japan's debt to GDP has hit 237%. Well, they didn't really "announce" it... It was hidden in another article...

No money? No problem, just borrow more!

From an article about the US debt entitled "G-20 Tells U.S. to Avoid Fiscal Cliff as Focus Widens" buried deep-down in the 19th paragraph, it says:

Japan, which has a debt of 237 percent of GDP, is also facing fresh budgetary challenges. Its Ministry of Finance is warning that a refusal by lawmakers to authorize 38.3 trillion yen ($476 billion) in borrowing risks leaving the government unable to hold debt auctions as planned.

Incredible! The Ministry of Finance wants to fix our debt problems by taking on more debt. Well, why not? Look how well it has worked these last 20 + some years!

What is really amazing is, though, it was just last May 22, 2012, to be exact (less than six months ago) that Bloomberg announced that Japan's debt had hit 220% of GDP. From "Japan Must Raise Taxes as Debt to Top 220% of GDP, OECD Says"

Gross public debt will be 223 percent of GDP next year, up from the projected 214 percent in 2012, “pushing Japan’s public finances further into uncharted territory,” the Paris-based OECD said in a report released today.

Only 223%? We wish. 

Folks going from 220% in May 2012 to 237% in November 2012 is almost a 9% increase in six months! At that rate it is equal to 18% a year. 

Those increases are worse than the rates you get when you take loans from yakuza loan sharks.

Doomed?

Everyone knows how "Exponential Growth" works, right? 

Exponential growth says that whenever growth is at a constant percentage, to see how long it will take for any number to double itself is just to take that constant percentage and divide it into 70.

At 18% growth, Japan's debt will double in 3.8 years. That means that Japan, continuing at this rate, will have a debt to income ratio of 474% by about summer of 2016... By 2020, Japan's debt will be 948% of GDP.

This isn't a guess, folks. This is simple math. 

Better get your financial house in order. This cannot go on like this.

Watch this and imagine that this is our debt....

It's Easy to Be Generous With Other People's Money

"It is easy to be conspicuously 'compassionate' if others are being forced to pay the cost." - Murray Rothbard

"The state is a gang of thieves writ large." - Murray Rothbard

Yesterday I sat in the lobby of the Grand Hyatt Hotel in Roppongi waiting for a meeting to start. It was the fifth time I have sat there waiting at the lobby in the last two weeks. It was the first time, though, that I saw that the lobby was crawling with undercover policemen.

My friend told me it was because there was an IMF meeting in the hotel.

Tokyo Tower as seen from the Grand Hyatt

Great! Not only do our masters lord over us and inconvenience our lives, they take our money and give it to each other.

Ron Paul once said, "Foreign aid is the act of taking money from poor people in a rich country and giving it to rich people in a poor country."

And that's just what happened; the Japanese government went and gave away money that they don't have and that is not theirs to give. 

Well, don't believe me. Let's have banker-thief Christine Lagarde IMF Managing Director tell you all about it:

“I warmly welcome today’s announcement by Finance Minister Jun Azumi on the Japanese authorities’ intention to contribute US$60 billion in additional resources to the IMF." 

What?! This country is in desperate financial straits as Hedgeweek reports in Japan's Ticking Time Bomb; "Japan’s debt-to-GDP ratio at 220%, is almost double that of Italy."

Great. Giving away money we don't have. No! Make that borrowing money and then giving it away, because that is de-facto what's happening here. How long can this go on?

Bread and Circuses: Olympic Games are a Scam to Take Yours and Your Children's Money Away!

"… Already long ago, from when we sold our vote to no man, the People have abdicated our duties; for the People who once upon a time handed out military command, high civil office, legions — everything, now restrains itself and anxiously hopes for just two things: bread and circuses."

(Juvenal, Satire 10.77–81)

They say the Olympics are a massive money making opportunity. They are for land developers, real estate agents, advertising agencies, the IOC, etc. For you? They stick you with a massive tax bill. For example, the Vancouver Olympics was such a massive burden and loss of public monies that the citizens of Vancouver and their children will be paying the bill for the next 30 years. 


Great deal, eh? 

Now do you feel proud when "your country" wins a medal?

Thanks to Aaron Egon Moser

Is Japan Heading For A Massive Economic Hit? All of Japan's Nuclear Power Plants About to Go Offline!

Here is an excellent report that was sent to me by my friend Aaron Egon Moser. I've written before about how it is possible that these events could seriously damage the Japanese (then world?) economy in Japan's Double-Edged Sword: What Happens When the Nuclear Power Plants Turn Off? 

To think that Japan can go on from here, into the next fews decades, in an era of declining oil production and rising oil costs and public debt coupled with an aging population problem without a cheap energy source is foolish and completely unrealistic....

In other words, it's not economical. The Center for Global Energy Studies says:

Despite high oil prices, fossil fuels will continue to trump renewable energy sources such as solar and wind power without massive government subsidies, a new investment bank says.

A report by Calgary-based AltaCorp Capital says the “economic realities” of oil and natural gas mean that the world will remain largely dependent on non-renewable energy sources for the foreseeable future.

Japan's government already has the highest debt to GDP levels in the world, it cannot afford to subsidize new industries like solar or wind farms... People will misunderstand what I have written here and say I'm pro-nuclear power. I am not. I am pro-business. I wish we didn't need nuclear power at all. My motivations are purely economical. I wish I could say it were true that Japan didn't need nuclear power to survive but it seems to me, that if I had to put it into a black and white perspective, it's a "damned if you do, damned if you don't" sort of problem for Japan.

Or could this be an opportunity for Japan to, once again, rise from the ashes of disaster? Watch this thought-provoking interview:

Let's hope that this summer is cool and geo-political problems give Japan breathing room and oil and natural gas prices remain at a relatively low cost. One can hope, right?... Not that "hope" has ever been a very good business plan... 

Call to Remove Japanese Prime Minister Noda From Office! Japanese Government Flushes Another $7 Billion Dollars Down the Toilet!

If you or I took other people's money without their 

permission and spent it, we'd go to jail... 

Once again, the news is out about the Japanese government wonks giving away money that they don't have. This comes at a time when the government complains to the public at home that they have no money and a lack of funds thus a need to raise taxes to support the aging population and to reconstruct the earthquake and tsunami struck area of Tohoku. 

Noda probably hot for this chick wants to impress her so, like 

a typical idiot Japanese salaryman, he tips waaaaaaay too much!

The Japan Today reports in Japan pledges $7.4 billion aid for Mekong development

Japan on Saturday pledged $7.4 billion in aid over three years to help five Mekong states, in an attempt at fostering development in a resource-rich region also being courted by China.

“The stability and prosperity of East Asia will not be possible without the stability and prosperity of the Mekong region,” Prime Minister Yoshihiko Noda told a press conference following a summit in Tokyo...

...Noda met leaders of the five Mekong region countries—Cambodia, Laos, Myanmar, Thailand and Vietnam—as Japan’s export-dependent economy seeks cheap labor and investment to power growth.

Folks, this is not an example of a government gone out of control, it's just government. This is another excellent example of why the government is not the answer to our problems but the main cause of them. Just a few weeks ago Prime Minister Yoshihiko Noda said containing Japan’s public debt load, the world's largest, is critical after Standard & Poor's downgraded credit ratings on the EU nations of France, Austria and seven others.... Then a few days later he just gives away over $7 billion?! WTF? 


Maybe he was trying to impress the hot babe in the picture above! This politician must be certifiably insane... Politician? Insane? Oh, but I repeat myself.

I've written repeatedly about this problem from the viewpoint of the burden on the local taxpayers. The Japanese government through their easy money policies and bailing out zombie banks over the years has put each and every man, woman and child in Japan ¥7,632,897 in debt (as of the writing of this article). If you want to read more on that (please make sure you're sitting down when you do), refer to: Here Comes Europe's and Japan's Debt Crisis - Just in Time for Summer. It will be much higher if sales taxes are raised.

Why in the world aren't the people in an uproar over this increase in debt?

Folks, we must get rid of these people in government. They are bankrupting us and our children. They are selling off the future of this nation. Noda must be removed from office by this July.

But do not think for a second that this is a problem related just to Japan. Of course it is related to all governments around the world. 

There are two things that must be done:

1) Return to sound money policies and use of real money based on some sort of gold standard.

2) The public must remember the famous quote by Lord Acton from 1887: "Power corrupts. Absolute power corrupts absolutely."

Point number 1 is happening right now as you read this. It is the slow motion train wreck that we so often read about. The powers that be are fighting  this return to real money and sound money policies because with a fiat currency and fractional reserve banking, they can spend money (and exploit the public) with funds that they don't have. They can create money out of thin air.

Japan went off the gold standard in 1931 and we saw what happened that year! Japan invaded China and that was the actual starting date of the Great Asian War. Western history books teach us that the great war started on Dec. 7, 1941...

2) Point number 2 must be remembered because it has an important lesson for everyone. People need to pay more attention to their government and leadership. This is not only centered on national political circles either. We have to keep an eye on what these politicians do in our name and demand that they work for the public and not the other way around.

This spending at the tax-payers expense (because the government has no money except what it takes as taxes) is unacceptable. This country can ill-afford it with the debt crisis, the nuclear crisis, reconstruction problems (still tens of thousands homeless in Tohoku), the aging population crisis, the trade deficit, Japan's major industries losing market share to Asian competitors... These problems and the government wants to take on more debt!?  

I am calling for the Japanese people to remove the government of prime minister Yoshihiko Noda from office immediately. 

If you agree with getting rid of the government, click "Like":

The "Like" button doesn't work? No? Just like the government. It doesn't work!

Entire Country of Japan Goes on Auction for ¥3 Mil. Yen (about $35,000)!

ヤフオク出品中！即決６９０万、２９０万円から入札可能，ただし落札者は日本の赤字の支払い義務が生じます！


They say that imitation is the greatest form of flattery so I hope the folks at Zerohedge will forgive me for, er, umm, flattering them so! Yeah. That's it! Flattering them! Over there they have a hilarious graphic showing the entire country of Greece on auction at E-Bay.


Absurd! Well, of course that would never work in Japan as no one in this country uses E-Bay. E-Bay came to Japan and failed like many other western countries did before them by not adapting their system to fit Japan and the Japanese mindset... But that's another story for another time.


In Japan, the online auction market is totally and completely dominated by Yahoo Auctions. 


Over at E-Bay, the starting bid for Greece was $1500.00 (USD) but Japan is far and away a bigger, better and more prosperous country than Greece so the price is a bit heftier but well worth the starting bid of about $35,000 (USD).


Check out the Yahoo Japan Auction page for the Wonderful Asian Paradise Auction! Japan!:

click on image for larger view:

Three days left and no bids?! Weird, eh?

There is, though, one tiny-weeny catch though... Beware the fine print! The lucky purchaser also receives the wonderful responsibility of taking over Japan's public debt of ¥1 quadrillion yen.


I'm sure the auctioneer might be guilty of mis-stating the debt on the graphic so let me explain for you:


¥1 quadrillion is a one followed by 15 zeros: ¥1,000,000,000,000,000 


In US dollars that would be about ¥12,000,000,000,000. In mere mortal terms that's 12 trillion dollars.


Will you be paying by cash, credit card or Paypal?  


Apologies to Zerohedge

Yen Devaluation Now Imminent? Being Called by Major Financials! Get out of debt - Get your financial house in order now!

Now, after yesterday's report that the main market analyst at China's Caixin Market News and Analysis reports that he is convinced of a 40% devaluation of the Japanese yen is imminent and inevitable, here comes another report hot on the heels from the United States. 

Market Watch reports in: The Yen's Looming Day of Reckoning

Japan is on an unsustainable path of a strong yen and deflation. The unprofitability of Japan's major exporters and emerging trade deficits suggest that the end of this path is in sight. The transition from a strong to weak yen will likely be abrupt, involving a sudden and big devaluation of 30% to 40%.

It will be a big shock to Japan's neighbors and its distant competitors like Germany. The yen's devaluation in 1996 was a main factor in triggering the Asian Financial Crisis. Japan's neighbors must have a strong banking system to withstand a bigger devaluation of the yen.Japan's nominal gross domestic product contracted 8% in the four years to the third quarter of 2011, and six percentage points of that was due to deflation. Without increased government expenditure, the contraction will be one percentage point more. Japan has not seen this kind of sustained deflation since the 1930s.

Without government deficits, Japan's economy will decline much more. Central government bonds and borrowings plus its guaranteed debts rose by 116.3 trillion yen ($1.4 trillion) during the period, equivalent to one-fourth of the level of the nominal GDP in the third quarter of 2011. If Japan had adopted balanced budgets, its economy would have contracted two to three times more. This will lead to a debt crisis in its private sector.

If you are living in Japan then it is time right now to get your house in order.

1) Stop using credit cards 
2) Get out of debt 
3) Store up at least three months (six months preferably) of food and water to get over the coming financial shock 
4) Protect your wealth by obtaining physical gold and silver

These warnings about Japan's collapse have been coming louder and louder and more often over these past two months. The crash that was predicted by Karl Bass and reported here in Debt in Japan Actually 492% of GDP! UK 497% of GDP!:

...People going along, as usual, in their ignorant bliss. The "leaders" knowing full well what's going on but trying to get out with what they can, while they can! The only difference between the sinking ship and the economy is there won't be any rescue coming for us.

While the entire world watches Greece and Italy, it seems, from looking at this chart, the real action is the UK, Japan, Spain and France. 

Business, government and household debt in Japan show a 492% of GDP problem for Japan. The tax and spend days are coming to an end soon in Europe, the USA and, of course, in Japan. 

This entire house of cards is going to collapse around our heads. When the collapse does come, it will come suddenly. Hope you have cash readily available and at least a few weeks of food and water ready. Because when the crash does come, stores will be empty in a matter if a few hours - if it takes that long.

You've read it on this blog and I seriously warn people to get ready... This could break any day now considering the still simmering situation in Greece, the worsening situation in Spain, Portugal and Italy, tensions and saber-rattling by the USA and Israel against Iran... And now more problems with a world wide move away from the US dollar.

May you live in interesting times.... Indeed. 

Japan is Facing a Currency and Economic Meltdown

There's an awesome article over at Zerohedge about Japan's current economic malaise. Please refer to, Japan Is Now Another Spinning Plate in The Global Economic Circus: 

For those who are in a hurry today, the bottom line is that Japan is in serious trouble right now and is a top candidate to be the next black swan. Here are the elements of difficulty that concern me the most, each one serving to reduce Japan's economic and financial stability:

• The total shutdown of all 54 nuclear plants, leading to an energy insufficiency

• Japan's trade deficit in negative territory for the first time in decades, driven largely by energy imports

• A budget deficit that is now 56% larger than revenues (!!)

• Total debt standing at a whopping 235% of GDP

• A recession shrinking Japan's economy at an annual rate of 2.3%

• Renewed efforts underway to debase the yen

Oh, and let's not forget that Greece is about to default day after tomorrow.


If you live in Japan, I hope that you have at least two weeks worth of food and water stored up (you should have that anyway - especially if you have children - as this country has lots of earthquakes). Preferable, if you have a place to put it, two months is best.


This article is coming hot on the heels of a post I wrote about being positive. Well, my friends, trust that it is much easier to be positive when you are prepared.


What should the government do? Well, twenty years of easy credit and deflationary policies haven't worked. Why don't we try what worked after the war to create the greatest economic recovery the world has ever seen? Please refer to: In 1949, Japan Started on the Road to Prosperity by Eliminating Sales Tax.


Raising taxes and continued debt spending has gotten us to where we are today. Devaluing the currency and taking on more debt won't help us. More debt will not solve a debt problem. That's basic math.


If you owed $10,000 on all your credit cards, would it help you if you got another credit card and borrowed $10,000 to pay off your old credit cards?


Why can't the government see this?


Devaluing our currency will only punish the people and the savers. We need people to save in order to invest.

In 1949, Japan Started on the Road to Prosperity by Eliminating Sales Tax! Let's Dream a Dream for Japan Again!!

Besides eliminating sales tax, Japan also pegged the yen to gold and lowered income tax rates. I've written over and over that increasing sales tax is not the answer to Japan's problems. Tax increases without cuts won't help us. We need to cut spending and cut taxes and return the yen to a stable currency.

Akihabara in 1945 and 2001

Need proof? It worked in Japan after the war to create the greatest economic recovery the world has ever seen!


Forbes Magazine writes in an article from Feb. 3, 2012: Let's Dream a Dream for Greece:

Japan’s recovery started with a dream, among politicians and business leaders. In their imagination, Japan would rise from the ashes – actual, real-life ashes – and become again a great and prosperous nation.

This clear vision quickly led to a plan of action. The situation in 1949, of hyperinflation and crushing taxes, was plainly not in accordance with the goal of a prosperous Japan, so the leaders set about fixing the problem.

They had virtually no resources to do so. The economy consisted mostly of black-market subsistence, tax revenues were negligible, and issuing debt was impossible. Since tax revenue was far less than the government’s needs, the government subsisted mostly by printing money, with the usual consequences.

One of the first things they did was to make government debt issuance illegal. It remained so until 1965. Then they refused any more economic aid.

In 1949, they pegged the yen to gold, immediately ending the hyperinflation.

Then, they eliminated the consumption tax (national sales tax).

Japanese gold coins from the 1850s

In 1950, the income tax schedule was revised. The top rate fell to 55% from 85%. But more importantly, the income at which that rate (and others) applied was raised dramatically.  This rate originally applied to income of 500,000 yen. By 1957, the 55% tax bracket applied to income of 10 million yen, twenty times higher.

In 1951, interest and dividend income were taxed at a separate, lower rate. In 1953, capital gains were exempted from taxation completely. Interest income was taxed at only 10 percent. Businesses received a truckload of favorable treatments, in the form of accelerated depreciation, deductions, and exemptions. In 1955, interest income was made tax-free.

Throughout the 1950s and 1960s, the government had a specific goal: to keep tax revenues, and the size of the government, below 20% of GDP. They reasoned that this would be best for the brisk growth of the private sector. It worked.

The Japanese people, as we know, became wealthy in those years. Wealthy people are able to pay more in taxes than poor people. Between 1950 and 1970, tax revenues of the central government increased by sixteen times, all in non-inflationary gold-linked yen.

As the country became wealthier, and GDP grew, then the services that the government could provide on a budget of 20% of GDP grew as well. Welfare and national healthcare plans were added. Dirt roads were paved. Sewage systems were built. There was no conflict between government services and the private sector. Both became prosperous together.

This story is well known to those who follow such things.

Read more here.

Thanks to Aaron Egon Moser

Japanese Prime Minister Says He Can Get Sales Tax Doubled - I Predict He Will Be Out of a Job by September 2012

This just came out on Bloomberg. The current Japanese prime minister Yoshihiko Noda says he can get a consensus and coalition on doubling the sales tax rate.

Bloomberg reports in Noda Says Deal Possible With Opposition to Double Consumption Tax:

Japanese Prime Minister Yoshihiko Noda said he thinks he can reach a deal with the opposition to double the 5 percent consumption tax in order to shore up the country’s social security system.

“I believe we can come to an understanding,” Noda told journalists from overseas media organizations today in Tokyo. “I sense that our debate is beginning to jibe.”

This guy is a goner

The combination of an aging society and a declining birthrate has put Japan in an “unprecedented situation” as the government seeks to rein in soaring welfare costs, Noda said. All political parties understand the urgency and must work together as “the question is how to secure stable financing for a sustainable social security system.”

Ha! Ha! Ha! That just shows how delusional this Noda guy is... He has to say stuff like this to the foreign press. Back at home, to the Japanese press, he'd get laughed at. 

Sadakazu Tanigaki, head of the main opposition Liberal Democratic Party, yesterday said on NHK Television that “it would be best” for Noda to seek a new mandate before submitting his tax legislation. He denied media reports that he and Noda met on Feb. 25 to discuss the situation.

Translation: The LDP doesn't want to seem responsible for raising taxes or not being able to fund social security, so they know that if they can force an election in summer, Noda will be out of office and they can keep kicking the can down the road - in the same way as we they been doing for twenty years.

The LDP has it right too. Noda hasn't even been prime minister for a year yet his popularity ratings are already weak enough that he could never stand a chance of winning any kind of election at all. Twenty seven percent approval rating is disastrous. Especially if you stand on an election platform of raising people's taxes!

Why don't they take a page out of Ron Paul's playbook? Cut spending first before even talking about raising taxes and maybe you'll get public sympathy.

Forty percent of voters oppose Noda’s tax plan, compared with 46 percent who support it, according to an Asahi newspaper poll published Feb. 14. Noda’s approval rating fell to 27 percent from 29 percent the previous month. The paper provided no margin of error for its survey of 1,741 people on Feb. 11-12.

Former DPJ leader Ichiro Ozawa, who is on trial for violating campaign financing laws, today on TV Tokyo reiterated his opposition to Noda’s tax plan. Nine lawmakers left the ruling party after it approved the proposal to raise the consumption tax to 8 percent in April 2014 and 10 percent in October 2015.

Really, what's the point of this nonsense article? There won't be any sales tax increase under this prime minister. He will be out of office if he really tries to do so. The crisis amongst the public and the political circles hasn't come to a boiling point (because people don't understand how exponential growth of our debts and interest rates on those debts are going to affect us). And, until this really hits home, people will not tolerate a sales tax increase.

We're way past that anyway. Even with a tax increase, if it is not coupled with a massive decrease in government spending, it will not matter because our debts will continue to accumulate along with the interest on those debts. Past history has shown that tax increases will not help as the government will deficit spend any increase in revenues it gets. When Noboru Takeshita was prime minister and instituted sales tax in 1988, he claimed that it would end our debt problem. It didn't. It couldn't without a cut in spending. After years of borrowing, we are already well past double the GDP in debt. We need to begin paying down that debt before any talk of a sales tax increase will even matter. That means we must massively cut spending right now. 

This is basic mathematics, folks. 

We need to cut spending, including interest on our debt - as well as paying down that debt to under what is received in revenue - as well as having tax increases to fix the problem we are in. I am against any and all tax increases especially if they aren't coupled with massive cuts in spending - and that's not cuts in future proposed spending, that's cuts in today's current budget.

It's simple. If you get five, you cannot spend seven. Once you owe fourteen, even if you start getting six, you still cannot spend seven. You will have to lower your spending to under all income in order to start paying back past debt and interest or you will never get out of the hole. 

Where to cut? Well. I'm sure we can start with cutting government waste and ridiculous spending on prevention of victimless crimes like prostitution, gambling, drugs, and ridiculous police raids on establishments that have waitresses sitting at tables with customers or arresting owners because people are drinking and dancing at restaurants on Saturday nights!   

Anyway, Noda will be gone by September because he doesn't understand these basic concepts and can't do simple first grade math... 

The best thing that could happen is a massive across the board cut in government services, but, in a country that changes prime ministers every year and has elections every summer, that isn't going to happen as politicians won't cut services because they want to give away our money so that people vote for them.

Our current system is ruined and there is no way to fix it. We are sliding down a steep slope into insolvency. 

The good news is that we won't have a sales tax increase this year. The bad news is that none of these other Japanese politicians are able to grasp first grade mathematics either.... Nor will our next prime minister.

The Perfect Argument Against Bailouts and Big Government Spending in One Picture

They say a picture speaks a thousand words. Here's a comic that does. It shows why we should be against all nationalization of industry and bailouts of industry and banks as well as tax increase and adding debt to our already un-payable debt.

Of course the free market system (which, by the way, we haven't ever really tried - there's always government control and cronyism) has its warts... But the way we do things now (bailouts, credit rate control, printing money, government take over of industry, government controlled education, medical care and retirement) just doesn't work. The fact that we're heading for bankruptcy (Greece is showing us what's going to happen to us soon enough) shows that we must stop this big government mentality.


If an industry like banks or big companies like General Motors or TEPCO in Japan go bankrupt, let them! Why do private companies get to keep profits but when they lose money the government wants to socialize their loses and stick it to the taxpayer?


And some taxpayers actually agree with this twisted logic?


Say in the case of a company like GM. If we bail them out, the same incompetent management get to keep their jobs. If they go bankrupt, a new group comes in and buys them up. The new group gets rid of the bad parts. The factories are still there, the buildings are still there, the new company needs someone to run those factories; they get rid of bad management and bad workers and start again. That's why they buy a bankrupt company in the first place; they think they can make it profitable!


But, when the government bails them out? The incompetents keep their jobs (and donate to the next election of those government people) and confused people in the public sector think that those industries should be nationalized. Yes. Nationalized and run ostensibly for a profit. Like the profitable venture that our, say, Japanese government has us at public debt of 229% of GDP.


What's wrong with this logic and this picture?  


Anyway, the same old same old way of doing business that we've been doing for the last 40 years, since 1971, has got to stop. 


Haven't we screwed up the world for our kids and their kid's kids enough as it is?