So still looking to me like a case of
‘Because we fear becoming the next Greece, we continue to turn ourselves into the next Japan’
The only way out at this point is a private sector credit expansion, which, in the US, traditionally comes from housing, but doesn’t seem to be happening this time. Past cycles have seen it come from the sub prime expansion phase, the .com/y2k boom, the S&L expansion phase, and the emerging market lending boom.
But this time we’re being more careful of ‘bubbles’ (just like Japan has done for the last two decades). So I don’t see much hope there.
Still watching for the euro bond tax idea to surface, which I see as the immediate possibility of systemic risk, but no real sign yet.