Economics
We’re All Japan Now as Virus Drives Low-Rates World Toward Zero
- Tapped-out central banks can’t get private sector to borrow
- Fear politicians will spend gives way to panic that they won’t
Photographer: Charly Triballeau/AFP via Getty Images
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There aren’t many precedents for the trauma that financial markets have suffered this week, as the coronavirus crisis drove U.S. stocks into a bear market and briefly sent yields on every Treasury bond crashing below 1%.
But there may be a precedent for the hole that policy makers find themselves in when the dust has settled. Just not an American one. The developed world’s last great holdout looks like it’s joining the Japanification club.