Nonetheless, Japan is now poised to build on the economic growthof the past two years and create a solid economic foundation in thedecade ahead. With the appropriate measures, the Japanese can lookback on the "lost years" (the 1990s) as a lesson learned and not tobe repeated.

The so-called setting of the Japanese sun, predicted by JamesFallows, among others, is largely a mirage derived in part from thelens that observed unprecedented success between 1950 and 1990.Four decades of success produced the illusion that any investmentwould lead to a significant rate of return. Many ill-advisedinvestments prompted by government linkages to the banking industryprecipitated the debt crisis. But the government has learned itslesson. Hence, debt is being reduced and the Nikkei is showingsigns of vitality. Although the growth rate will not measure up tothat of Japan's greatest boom years, 3 percent GDP growthcompounded should produce a new generation of wealthy Japanese.

It is no surprise that Wall Street is finally taking notice.Japan is back on the investment radar screen. The sun is notsetting in Japan. Rather, it is starting to rise. Any other bet inthe next couple of years is likely to be misguided.

Essay Types: Essay