More than twenty years after its infamous real estate and equity bubble burst, Japan has been plagued by economic malaise; an ailment most main stream economists have attributed to something they call a deflationary death spiral. As one lost decade turned into two, and now well into number three, Japan’s Prime Minister Shinzo Abe has vowed to remedy this deflationary flu with an enormous dose of inflation.
In Japan, they affectionately refer to this elixir as Abenomics. In English, this remedy roughly translates to an enormous injection of public spending, more than a spoonful of currency destruction, chased down with a large dose of a consumption tax.
And if deflation had actually been what had ailed the Japanese economy, it would appear that after more than two decades they finally found their cure. The price of food is soaring at the fastest pace in 23 years and core consumer prices jumped 3.2 percent YOY in April.
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