NEW YORK —
So more people have the capacity to borrow, spend and invest more. But will they?
Sahoko Tanabe of Tokyo, 63, lost money in Japan's stock market crash more than two decades ago, but she's buying again. "Abenomics," a mix of fiscal and monetary stimulus named for Japan's new prime minister, has ignited Japanese stocks, and she doesn't want to miss out. "You're bound to fail if you have a pessimistic attitude," she says.
But for every Tanabe, there seem to be more people like Madeleine Bosco, the Californian who ditched many of her credit cards. "All of a sudden you look at all these things you're buying that you don't need," she says.
Attitudes like Bosco's will make for a better economy eventually — safer and more stable — but won't trigger the jobs and wage gains that are needed to make economies healthy now.
"The further you get away from the carnage in '08-'09, the memories fade," says Stephen Roach, former chief economist at investment bank Morgan Stanley, who now teaches at Yale. "But does it return to the leverage and consumer demand we had in the past and make things hunky dory? The answer is no."