I don't follow the monetary and fiscal problems of other countries very closely. We've got enough of a crisis here to worry about anywhere else.

But during the stim bill debate, you may recall liberals pointing to Japan's "stimulus spending" in the decade of the 1990's as an example of how to get out of a deep recession.

Maybe they should have read the fine print as Ambrose Evans-Pritchard of the Telegraph explains:

The IMF expects Japan's gross public debt to reach 218pc of gross domestic product (GDP) this year, 227pc next year, and 246pc by 2014. This has been manageable so far only because Japanese savers have been willing - or coerced - into lending for almost nothing. The yield on 10-year government bonds has been around 1.30pc this year, though they jumped to 1.42pc last week.

"Can these benign conditions be expected to continue in the face of even-larger increases in public debt? Going forward, the markets capacity to absorb debt is likely to diminish as population ageing reduces saving," said the IMF.

The savings rate has crashed from 15pc in 1990 to near 2pc today, half America's rate. Japan's $1.5 trillion state pension fund (the world's biggest) has become a net seller of government bonds this year, as it must to meet pay-out obligations. The demographic crunch has hit. The workforce been contracting since 2005.

Japan Post Bank is balking at further additions to its $1.7 trillion holdings of state debt. The pillars of the government debt market are crumbling. Little wonder that the Ministry of Finance has begun advertising bonds in Tokyo taxis, featuring Koyuki from The Last Samurai. If Japan's bond rates rise to global levels of 3pc to 4pc, interest costs will shatter state finances.

No one knows exactly when a country tips into a debt compound trap. But Japan must be close, even allowing for the fact that liabilities of the state Loan Programme (FILP) have fallen by 40pc of GDP since 2000.

Some analysts say that the situation is "irrecoverable." "This is incredibly dangerous," said Russell Jones from the RBC Capital Markets. Jones is referring to the 2.4% drop in prices in October, the biggest drop in modern Japanese history. The central bank seems paralyzed and the new government is simply piling more debt on top of the massive amount already spent.

Evans-Pritchard concludes:

Japan's terrible errors are by now well known. It failed to jettison its mercantilist export model in time. It resisted the feminist revolution, leading to a baby strike by young women. It acquiesced in a mad investment bubble (like China now) in the 1980s, stealing growth from the future.

It wasted its immense fiscal firepower, scattering money for 20 years on half-baked spending projects to keep the economy afloat. QE was too little, too late, and this is the lesson for the West. We must cut borrowing drastically over the next decade, and offset this with ultra-easy monetary policy. Does Downing Street understand this? Does the White House? Does the European Central Bank? Clearly not.

All of this happy talk about our 3.5% growth in one quarter being a sign that the worst is behind us is a mirage. The same situation exists in all industrialized welfare states to one degree or another. It's cause is borrowing against the future to pay for benefits today.

And if Japan is any indication, the chickens are about to come home to roost.