Economic Bubble - Economic Bubble The Japanese economy...

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Economic Bubble The Japanese economy experienced tremendous growth since the end of the Korean War. GDP growth in 1967 and 1968 was over 10% (period of double digit growth), exceeding in countries like Britain, France and Germany. The economy experienced a rise is due to many reasons such as: the expansion of industrial facilities, massive adaptation of Western technology and education, reduce military spending to 1% of GDP, the relationship with the national power human resources and spirit to achieve "zero defects program." But after the first oil crisis and the second occurs from 1973 onwards. Moves the economy down in part because of the mismanagement of economic policy. Although the government tries to adjust economic policy, but recovery was slow. As the yen continues to rise in export demand has increased enormously. With the concern of the United States this problem, President Reagan and the G5 have signed an agreement with Japan called "Plaza Accord", the agreement provides that the exchange rate of Japan and DM can be seen against the USA. Since then, the value of the yen began to appreciate, Japan was going through an adjustment period the trade balance. While Japan is prepared to go through an adjustment period the trade balance, but also will suffer a recession, so strongly that government business activities to strengthen the economy in order to avoid effects of washing. It was this event that will drive the GDP and raise the rate of change. With this advantage of the exchange rate that business investment in housing and securities that created a bubble economy. During this period, most of the country are involved in land speculation or other speculative activities. This essay shows that the speculative activities of the land had to create many negative effects on Japanese society and the economy. First, it describes the cause of land speculation. Secondly they will discuss society and political effects in Japan and, finally, focusing on the effects of the economy, more about him including the consequences when the collapse of the bubble. The root of the bubble economy is due to the wave of land speculation. The wide dissemination of the activities of land speculation were mainly because it is profitable. Speculative transactions in assets grew and grew and many believe that this will last for a very long time. One of the reasons leading to massive investment in the activities of risk is due to the success of the Japanese in the international market for 70 s * - 80 * s. Many Japanese companies and business men had become very wealthy. These people have a large sum of capital to invest. Some of these people have the focus on risky assets like stocks and land, therefore many of the regular companies were left behind. One of the main causes of the massive operation in the land market was due to increased bank lending. Financial institution has been very positive in lending money to the company. This improved
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This note was uploaded on 09/20/2011 for the course ECO 561 561 taught by Professor Jonnanoe during the Winter '09 term at University of Phoenix.

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Economic Bubble - Economic Bubble The Japanese economy...

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