The world’s second-largest economy appears broke.
“The debt situation is irrecoverable,” says Carl Weinberg of High Frequency Economics, referring to Japan.
“I don’t see any orderly way out of this.
They will not be able to fund their deficit.
There will be a fiscal shutdown, a pension haircut and bank failures that will rock the world.
It is criminally negligent that rating agencies are not blowing the whistle on this.”
Japan, at the moment, looks like it is falling apart.
Analysts, for instance, are questioning whether Tokyo will be able to finance its debt this year.
Some are even thinking the world’s second-largest economy could go bankrupt by 2011.
The best scenario, in the opinion of other observers, is that the country can postpone a sovereign debt crisis for three or four years.
And here’s a new phrase you may hear soon: “sovereign ‘Chapter 11.'”