The United States has been urging Japan to expand domestic demand, as if that was the only policy Japan could implement to help promote recovery of the global economy. Washington repeated that demand at the recent Group of Seven meeting of finance ministers and cen- tral bankers.

It should be noted that while U.S. domestic demand is booming, the nation's savings rate has fallen to a record-low level; it has even posted minus figures in some months. On the other hand, Japan boasts a whopping 1.3 quadrillion yen in savings accounts held by individuals, the largest in the world.

Americans and Japanese have radically different spending habits. Americans go on a spending spree that sometimes involves going into debt, while Japanese minimize their spending to save. Americans tend to spend more than they can afford, and that is not a healthy sign. The U.S. spending binge makes me think of Japan's "bubble economy," which burst a decade ago. It could be a precursor to a major economic disaster.