Title: Japan's Economy: Abenomics, Effect on U.S.
Headings: Japan's Economy, Abenomics, and Impact on U.S. Economy
Japan's Economy, Abenomics, and Impact on U.S. Economy
7 Reason's Japan's Economy Is Stuck
Trade
What's Wrong With Japan's Economy?
7 Characteristics of Japan's Economy
Japan's Lost Decade
The Tsunami and Fukushima Disaster
Abenomics Tried to Fix the Problems
Expansive Monetary Policy
Expansive Fiscal Policy
Structural Reforms
How Japan Affects the U.S. Economy
The Bottom Line
Article Sources

Content: Japan relies on its central bank to prop up its economy. Government spending is around 16.4% of the country's GDP. But Japan can't finance this through taxes because that would slow growth even more. Therefore, in order to spur growth, the Bank of Japan strives to keep interest rates low. It does this by continuously buying government debt, a tactic similar to the U.S. quantitative easing program, which was utilized during the Great Recession and is currently in use to combat the economic fallout from the global health crisis. Currently, Japan's central bank owns $4.5 trillion in government bonds, roughly half the total. 9 The bank’s discount rate is just 0.3%, and it promises to keep rates low. 10 As a result, people expect low rates and falling prices, which reinforces Japan’s deflationary environment. The expectation means that every time prices rise, consumers stop buying. They just wait for prices to drop again.