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Hillary Clinton is one of several prominent figures to warn that the US “might be drifting into a Japanese-like situation”.
Three factors distinguish Japan’s long malaise from the present US crisis:
the source of the problem, the size of the problem and the response of policymakers.

Richard Katz, Financíal Times April 21 2008

Richard Katz, Author and Senior Editor of Toyo Keizai's Oriental Economist

In the 10 years before the 2006 peak, US house prices in the 20 biggest cities rose almost 200 per cent.

In the 10 years prior to Japan’s 1991 bust, commercial land prices in its six biggest cities rose almost 500 per cent.

The bust not only erased all of that gain but also brought Japanese prices down to 25 per cent below 1981 levels.

Most forecasters think US housing prices will drop a third from their peak, leaving them well above pre-boom levels.

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