The world's most radical experiment in monetary policy isn't working

Deflation is bad for an economy because it undermines economic growth

During Japan’s go-go 1980s, Hiromi Shibata once blew a month’s salary on a cashmere coat, wore it a few times, then retired it. Today, her daughter’s idea of a shopping spree is scrounging through her mom’s closet in Shizuoka, a provincial capital.

“About a third of my wardrobe is hand-me-downs from my mom,” says 26-year-old Nanako Shibata, who lives in Tokyo. To save on the 112-mile trip home, she rides the bus instead of the speedy bullet train, once a symbol of Japan’s rise.

The US appears to be leading other parts of the globe out of an extended era