Thanks Akira, As I said, my answer was brief--by which I meant very rushed--so I'm glad it provoked someone who knows more about this to contribute. Just a query--I thought the official rate had been near-zero for many years, from about 1993 till 1999 (at about 0.1%, I thought). Your correction to my statement here is a bit confusing: do you mean that a rate of exactly zero was only instituted in March 1999, or that the rate was moved above zero then? I thought the zero rate was only abolished early this year. On the boom itself, yes that's true; but the real acceleration in real estate prices began after the 1987 stock market crash, I thought. And the peak of the Nikkei was also at the very end of 1989--though as you say, real estate prices continued to rise. Incidentally, is this book by Garyt on Minsky? IF so, you might like to elaborate on his theories of financial instability for the benefit of other list members. All the best, Steve At 09:36 24/10/00 +0900, you wrote: >Dear Steve, > >It was only March /1999 that the Bank of Japan adopted the "Zero interest rate policy" that induced the call rate up to 0 %. > >And I think the period of Japanese bubble was 1985-1990 or 1991. Because prices of Japanese real estate had increased until 1991. > >Recently I completed an article about the bubble economy for the book edited by Gary Dymski. > >bye > >Akira > > > > > > >At 10:42 AM +1000 00.10.24, Steve Keen wrote: >>Hi, >> >>Very briefly, official interest rates in Japan have been zero from 1990 >>until just recently. The reason for this was the massive accumulation of >>debt--mainly by Japanese companies--to finance purchases of Japanese real >>estate during their Bubble Economy in 1987-89. >> >>The levels of debt are such that, while before interest profit rates are >>nothing out of the ordinary, they would be swamped by interest repaytments >>on this debt were interest rates in the normal range of 1-2% after inflation. >> >>Inflation has also mainly been deflation in the last decade, so that a zero >>nominal rate translates as a positive "real" rate. >> >>Cheers, >>steve >> >>At 10:20 23/10/00 +0100, you wrote: >>> >>>One real world question that has just struck me is that money market >>>rates in Japan are currently less than 1%. >>>Does anyone know if the rate of profit in Japan is of this same >>>low order? >> >>Dr. Steve Keen >>Senior Lecturer >>Economics & Finance >>University of Western Sydney Macarthur >>Building 11 Room 30, >>Goldsmith Avenue, Campbelltown >>PO Box 555 Campbelltown NSW 2560 >>Australia >>s.keen@uws.edu.au 61 2 4620-3016 Fax 61 2 4626-6683 >>Home 02 9558-8018 Mobile 0409 716 088 >>Home Page: http://bus.macarthur.uws.edu.au/steve-keen/ > >-- >####################################### >MATSUMOTO, Akira > >Associate Professor on Money and Banking >Department of Comprehensive Policy Making >Faculty of Law & Letters, EHIME University > >Matsuyama, Ehime >790-8577, Japan >Tel:+81-89-927-9237(office) >Fax: +81-89-927-8916 >E-mail: amatsu@ll.ehime-u.ac.jp >####################################### > > Dr. Steve Keen Senior Lecturer Economics & Finance University of Western Sydney Macarthur Building 11 Room 30, Goldsmith Avenue, Campbelltown PO Box 555 Campbelltown NSW 2560 Australia s.keen@uws.edu.au 61 2 4620-3016 Fax 61 2 4626-6683 Home 02 9558-8018 Mobile 0409 716 088 Home Page: http://bus.macarthur.uws.edu.au/steve-keen/
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