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Author: torobravo2003 Three stars, 500 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 35400  
Subject: Re: Bond Duration vs Maturity Date: 5/8/2003 12:20 PM
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I debated whether to keep my mouth shut or not and the "not" won.

Japan's problems have nothing to do with its aging population. Well, I shouldn't say "nothing" but what impact it has in the scheme of Japan's problems in miniscule.

While I'm not an absolute expert on Japan, I do know well its current situation because I have worked in that country in finance.

Japan's housing prices fell because of over supply. Banks lent to construction companies and the sky was the limit. When supply overcame demand, the house of cards tumbled. And continue to tumble because no one knows the real price of real estate in Japan because (1) the market is not transparent, (2) construction companies still control the politics, and (3) there are a lot of non-market variables that prevent selling properties (for example, in an apartment or office building, all tenants or 90% of the tenants have to agree to the sell).

If the U.S. has deflation, it will not be for the same reasons that Japan has deflation.
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