The thing that concerns me is that we have a service-based and consumption-based economy. If you cut wages and jobs broadly enough, people will stop using services and stop consuming and then we'll be where Japan is. And there is no end in site to where Japan is and deflation is starting to kick in.
Japan is service based? I thought they made lots of stuff?
Japan is service based? I thought they made lots of stuff?
Just like America does -- in China. I once read that the average business in Japan employs 5 people (before the current bust). Think about that. A lot of their businesses are service-based.