The 1990s were a lost decade for Japan. The 2000s delivered a lost decade to U.S. investors. Now, five years into the onset of the financial crisis, with stock and bond markets booming, housing resurgent, and even Detroit redeemed, it’s savers who find themselves in a lost decade.
This runs counter to the lessons of the credit bubble. We were urged to spend less, save more, tell fewer lies on our mortgage applications. Problem is, the jumbo monetary response to that era’s excesses—0 percent interest rates, followed by trillions in quantitative easing and a vow to keep rates this low until at least 2015—is bent on getting people and companies spending and investing (and out of cash) at pretty much any cost.