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Those of us who have read Richard Koo understand that Japanese deflation is only a symptom of its balance sheet recession, not the cause of it. The real cause of  the malaise is a widespread and prolonged focus on deleveraging which is a rational reaction to the bubbles of prior years. The odds of this scenario playing out here in the U.S. are greater than most imagine. For more about this topic read the first issue of “The Felder Report” available here.