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Japan’s sovereign credit rating was downgraded by Standard & Poor’s in January. The rating agency lowered Japan to “AA-,” citing Tokyo’s lack of a coherent strategy for dealing with its soaring debt, which now stands at 200% of GDP. For perspective consider that the American federal debt, which is high enough to prompt a government-paralyzing standoff between Congress and the White House, is less than half of that percentage. Yes, Japan owes a lot of money, and the bond ratings agencies are finally starting to question whether it will be repaid.

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Japan’s sovereign credit rating was downgraded by Standard & Poor’s in January. The rating agency lowered Japan to “AA-,” citing Tokyo’s lack of a coherent strategy for dealing with its soaring debt, which now stands at 200% of GDP. For perspective consider that the American federal debt, which is high enough to prompt a government-paralyzing standoff between Congress and the White House, is less than half of that percentage. Yes, Japan owes a lot of money, and the bond ratings agencies are finally starting to question whether it will be repaid.