On the eve of World War II, Keynes delivered the following chilling address on the BBC, talking about the "grand experiment" of curing unemployment through war expenditure:
Two years later to the day, in a lecture delivered shortly after his arrival in the U.S., Mises described what the great experiment really looked like:
We are witnesses to the most frightful and phenomenal occurrence in human history: the decay of Western civilization.
London, one of the centers of this civilization... is almost completely destroyed. The buildings of the Parliament of Westminster are in ruins; the House of Commons holds its assemblies in the catacombs. [...]
The theater of war is spreading, and the day seems not distant when peace will have lost its last refuge. It is a moral and material collapse without precedent.
A similar situation had occurred in the US in the 1930’s.
What solved the question? War! Because World War II had occurred during the 1940’s and that became the solution for the United States. So, let’s look at the entrepreneurs in Japan. They are stuck with the deflationary mindset.
They have to switch their mindset and should start making capital investments. We are looking for the trigger.