• It’s argued that Japan didn’t get a return of all its deficit spending in the decades after its epic financial bubbles burst. This could not be further from the truth.
• Despite the epic size of these bubbles and the world’s worst demographics, Japan’s economy kept on growing on par with other rich economies.
• It never experienced anything remotely like a depression or come anywhere close to double-digit unemployment.
• And it’s really not all that difficult to see why. When the private sector is deleveraging, the public sector should leverage up.
• Monetary policy is much less effective, but the BoJ was forced into QE by an impending debt-deflationary spiral.

Source: Japan’s Massive Return On Public Investment | Seeking Alpha