Yesterday we reported on the progress of China's growth. They are seeing a GDP growth rate almost at 10%. And that is with their currency pegged to the dollar. Whereas Japan seems to be faltering.
The
Japan Times reports:
"The Cabinet
approved a ¥92.30 trillion initial budget Friday for fiscal 2010 — the largest ever — allowing Prime Minister Yukio Hatoyama to fulfill his goal of winding down the drafting process by year's end. But the size of the general-account budget is larger than Hatoyama was hoping for, stoking long-simmering worries about Japan's fiscal health. By comparison, the initial budget for fiscal 2009 was ¥88.55 trillion and relied on unprecedented levels of fresh debt issuance and nontax receipts. The economic slump is projected to bring tax revenues down to ¥37.40 trillion, the lowest since fiscal 1984. As a result, the Cabinet will have to issue ¥44.30 trillion in new government bonds — an alarming increase of 33.1 percent on the previous initial budget. The latest amount equals the sum of the bond issuance planned by the previous government for the initial budget, and the first extra budget for fiscal 2009."
Japan seems to be rapidly sinking in its own debt. That is a harbinger for the US. Also if Japan in 2010 falls behind China in GDP, which we expect, then the US is next. We anticipate a GDP for China in 2010 of well in excess of $5.5 trillion whereas the US is at best to hist $14.5 trillion. If China continues to grow at almost 10% rate then we see the passing of the US by 2020.
China is stressing entrepreneurial growth whereas the US is destroying it under the current Administration. the coming year should prove interesting.
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