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Roach: what have we learnt from Japan?

Stephen Roach, Asia Chairman of Morgan Stanley compares current housing-led crisis with Japan's in 1990s.
He sees many similarities between the two. His thinks Fed's aggressive interest rate cuts and Congress' stimulus package won't solve the problem, "Like their counterparts in Japan in the 1990s, American authorities may be deluding themselves into believing they can forestall the endgame of post-bubble adjustments".
His solution, "A more effective strategy would be to try to tilt the economy away from consumption and toward exports and long-needed investments in infrastructure". 
He also argues, "Washington should help the innocent victims of the bubble’s aftermath — especially lower- and middle-income families. But the emphasis should be on providing income support for those who have been blindsided by this credit crisis rather than on rekindling excess spending by overextended consumers".

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