Comparing and Contrasting Indebtedness - Japan Versus the United States

In Japan, cash is king; in contrast, American consumer spending appears to revolve around plastic credit cards. At the root of the difference in attitude is the notion that a lack of cash translates into a foregoing of immediate gratification in Japan, while by and large American holds the monopoly on instant gratification with the help of plastic. While avoidance of debt may be a virtue, the underlying though processes speak of a reluctance to be indebted to anyone, whether a bank or a foreign country; when comparing this attitude to American sentiments, it becomes obvious that the latter do not share in this notion and the country as a whole finances its excesses by selling off bonds which the former are eagerly buying.

Whether it is a mistrust of the banking system or a cautious holding on to tangible riches rather than paper promises of stocks owned, Japan's consumers refuse to risk their financial health while American consumers are almost playing Russian roulette with the loans they willingly take on.

It has been said that Japan's love of cash is rooted in its willingness to value stability over risk taking, while America's unwillingness to let go of plastic may be traced directly to its ability to engage in even the riskiest behaviors if the odds look like the gamble may pay off. While not a stigma per se in the States, bankruptcy in Japan is considered to be shameful enough for many debtors to take their lives when faced with the option. It is not surprising that what the people practice at home is being practiced on the national level as well. While America is selling treasuries to fund its spending, Japan is buying them and thus controls in many ways whether the United States economy will remain afloat or take a dive.