Bank of Japan’s monthly assessment says economy still fragile

Yahoo! News – Bank of Japan’s monthly assessment says economy still fragile

The Japanese economy should be held as the poster child for ending central control of the economy. Japan has been floating deadwood businesses for far too long. In a free market, bad businesses fail. It is hard for me to see how a culture with so much Buhddist influence can fail to see the natural cycle of rise and fall.

What is the bank’s solution to the market’s failure to punish poor business decisions? Prop up the bad banks. Remind them that if you make poor loan approvals there still isn’t anything too bad that will happen.

Enron and Worldcom are dirty words? You should remember that we must allow businesses that fail — businesses that lose their support because of fraud, or poor decisions, or whatever — because this is what drives an economy forward. An economy may not be a closed system, but it is self-correcting. When you don’t allow it to make those corrections, then it will slowly decay, whether it is the open socialism of Red Russia, or the quiet socialism of Japan and Britain.

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