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The 1989 Nikkei bubble & Japan's balance-sheet recession

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This is What a Balance-Sheet Recession Looks Like, and It's Not Pretty. Stephen Gordon says these graphs make him grateful that Canada is not the US: This is what a balance-sheet recession looks like, and it's not pretty, Worthwhile Canadian Initiative: I had never heard the expression "balance-sheet recession" before this recent episode, and it's time I got around a comparison of the household balance sheets of the US and Canada.

Of all my "Canada is not the US" posts, this is the one that makes me most grateful. The quarterly data goes back to 1990, and it's good to put the last few years in context. I've scaled all the series by price (the consumption spending deflator) and population. Here is the net worth series: There's been talk of a Japan-like 'lost decade' in the US; that seems optimistic. US real per capita net worth is back to what it was back in 1999. The US problem is on the assets side: The effect of the recent recession on assets in Canada is similar to that of the demise of the dot-com boom. The Holy Grail of Macroeconomics: Lessons from Japan's Great Recession. The Age of Balance Sheet Recessions. Balance Sheet Recession: Japan's Struggle With Uncharted Economics and Its Global Implications.