Uma das mais interessantes análises da crise da economia japonesa. Retomando o conceito de "balance-sheet recession" Richard C.Koo foge da mesmice da análise econômica do livro texto e desenvolve um "approach" bastante útil para entendermos a atual crise da economia americana. O curioso é que durante a crise da economia japonesa, nos anos 90, ele se encontrava em lado oposto ao Krugman e Bernanke, defendendo medidas de cujo fiscal, enquanto os dois defendiam medidas monetárias e criticavam a política fiscal japonesa. Hoje Krugman é um fiscalista, mas com argumentos pobres. O senso de oportunidade, nem sempre é acompanhado de profundidade teorica. Melhor assistir a palestra do Koo no CSIS. Imperdivel, apesar de longa.
Japan's economic recovery and stock-market rebound caught many by surprise, especially those who were led to believe the country would never bounce back without sweeping structural reform or drastic monetary easing. The economy recovered, however, because its decade-long stagnation had little to do with either structural or monetary problems. The Japanese stagnation actually had everything to do with a rare phenomenon called a balance-sheet recession, where the vast majority of companies in an economy devote most of their resources to paying off their debts even when interest rates are near zero.
Japanese corporations started cutting back on borrowing as early as 1991, and by 1998 the whole corporate sector was a net repayer of debt. By 2003, the annual debt repayment reached 7% of GDP. Companies paid down debt because they faced a massive fall in asset prices after the collapse of the bubble economy in 1990, with commercial real estate values in major cities plummeting by nearly 90% in some cases. Since these assets were typically purchased with borrowed funds, the collapse devastated balance sheets and left many companies owing far more on properties than they could possibly sell them for.
On the other hand, the main line of business for most companies -- whether building cars, cameras, or precision machinery -- continued to do well. The fact that Japan ran one of the largest trade surpluses in the world throughout this period suggests that its ability to supply quality products at competitive prices was still intact. With business largely healthy, the companies started doing the logical thing under the circumstances: using their cash flow to pay down debt to repair the balance sheet.
DEFLATIONARY PRESSURE. This shift to debt minimization, however, completely disrupts the normal workings of the economy. That's because the corporate sector no longer borrows the funds saved by the household sector, even at ultra-low interest rates. With no one borrowing, those personal savings -- plus the debt companies are repaying -- pile up unused in the banks, effectively shrinking aggregate demand by the same amount. Left unattended, this deflationary gap will continue to shrink the economy until almost everyone becomes too poor to save any money.
In post-bubble Japan, this gap peaked at 8.5% of GDP in 2003. Deflationary pressure of such magnitude will throw any economy into recession, or even outright depression. Furthermore, many companies started paying down debt as early as 1992, when Japan still had inflation, indicating that it was the fall in asset prices, not deflation in output prices, that has been the main concern of Japanese companies.
In this type of recession, monetary policy is ineffective. Even though central bankers typically bring interest rates down in response to a recession, they cannot increase the money supply. That's because nobody is borrowing money, so the liquidity provided by the central bank cannot leave the banking system.
PORK-BARREL BENEFITS. The government, of course, can't tell private-sector companies not to repair their balance sheets. So all it can do is the opposite of the private sector -- take up the excess savings in the private sector and put the money back into the economy. This fiscal action is needed not only to stabilize the economy and give companies time to repair their balance sheets but also to keep the money supply from shrinking as a result of the private sector paying down its debt.
And that's exactly how Japan managed to stay afloat in spite of a loss of wealth that exceeded $10 trillion. As a percentage of GDP, this was far bigger than the loss the U.S. suffered during the Great Depression in the 1930s. But under President Hoover 70 years ago, the U.S. lost a third of GDP and money supply, while Japan managed to maintain stability in both because of the prompt fiscal response that filled the deflationary gap each year before the contraction was allowed to start.
Although the pork-barrel politicians -- and their opponents, for that matter -- never understood the crucial role they were playing in keeping the economy stable, they allowed the corporate sector to pay down so much debt that many companies are now finished with their balance-sheet repairs. Today, corporate borrowing from banks as a percentage of GDP, which reached 85% during the bubble days, is down to 52% -- a level last seen in 1956!
GLOBAL RISKS. This is the root of the Japanese economic recovery. Today's leaner and meaner Japanese companies are again using their cash flow to build businesses instead of paying down debt. With employment, production, and asset prices all going up, it's just a matter of time before Japanese companies will make their presence known. Many will follow the footsteps of Toyota (TM), a company that had no debt to begin with and therefore suffered no balance-sheet problems during the last 15 years. Those abroad who have written off Japanese companies as inconsequential would be well advised to check back.
Companies and economists worldwide should take note. In the U.S., the corporate sector also appears reluctant to borrow in spite of the lowest long-term interest rates in 40 years. Most likely, that's because, after the bursting of the tech bubble and the Sarbanes-Oxley Act, they're more concerned with strengthening their balance sheets than their usual profit maximization. Although U.S. corporate balance sheets are now quite strong, American households may find a similar balance-sheet challenge if the housing bubble collapses.
Europe should also be concerned about balance-sheet problems, because the German corporate sector has been paying down debt since the bursting of the telecom bubble. To make matters worse, German households are increasing savings. To counter the deflationary pressures, Germany needs to either put in sufficient fiscal stimulus or export its way out.
BITING THE HAND. A balance-sheet recession is both inaudible and invisible, because companies with balance-sheet problems aren't eager to share that information with the outside world. Although repairing balance sheets is the right and responsible thing to do for individual corporations, when many companies simultaneously shift their priorities from profit maximization to debt minimization, Adam Smith's Invisible Hand reverses its normal direction and shrinks both the economy and the money supply.
Even though a small government relying on monetary policy for economic management is best when private sector balance sheets are healthy and companies are all forward-looking, a proactive government with a credible fiscal policy is essential when private sector balance sheets are underwater and companies need time and revenue to regain their financial health.
Richard C.Koo
Fonte: Business Week
