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To: Mase

http://www.americanprogress.org/site/pp.asp?c=biJRJ8OVF&b=275404

I don't know where or how the CIA got those numbers but they are impossible for Japan since they have been running trade surpluses for years. Even during the 1990s. I can only guess that the CIA is including foreigners buying debt issued by Japan's central government

That CIA chart is off because it has every well known nation having an external debt. This just ain't true


58 posted on 07/05/2006 10:38:40 PM PDT by dennisw (Confucius say man who go through turnstile sideways going to Bangkok.)
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To: dennisw
Trade surpluses have little to do with "external debt" calculations in the abstract. You're conflating separate economic issues. Every nation on earth has external debt. All that means is that the residents, banks, companies, or governments of one country owe principal or interest payments to similar persons in another country. It says little about financial solvency in the abstract and it says little about the balance of trade. It is not offset by similar debt holdings the first country has in other countries so virtually every country on earth is holding external debt.

"Public debt", on the other hand, is what that 170% figure is referring to in that above post. Public debt is the amount of debt a national government owes to its creditors for loans to used to fund government operations. The government of Japan is deeply in debt.

Neither of those figures is directly determined by balance of trade deficits. Balance of trade shortfalls can be made up by taking on more external debt(loans, bonds) or selling off assets(stocks, land, factories, equipment, etc). Which means that external debt is not necessarily directly affected by the trade balance. Public debt(the figure people talk about when complaining about the National Debt) doesn't necessarily have anything to with trade deficits at all. It's just a matter of whether the government spends more than it brings in, and how they choose to fund shortfalls.
60 posted on 07/06/2006 5:19:30 AM PDT by Blackyce (President Jacques Chirac: "As far as I'm concerned, war always means failure.")
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To: dennisw
I love your source.

American Progress Staff

Senior Staff
• John Podesta President and Chief Executive Officer

I can only guess that the CIA is including foreigners buying debt issued by Japan's central government

Yeah, that'd be external debt.

64 posted on 07/06/2006 9:38:27 AM PDT by Toddsterpatriot (Why are protectionists so bad at math?)
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