Can Japan save the global economy?

Japan's recovery has been 'nothing short of stunning', says Stephen Roach of Morgan Stanley. And it looks set to continue. But can recovery in Japan resolve the imbalances threatening the global economy?

Investors tell me that Japan is on fire. And on the surface, it certainly seems white hot a stock market that is up some 50% since the spring of 2005 and an economy that our Japan team believes surged by at least a 7% annual rate in the final quarter of calendar year 2005.

If that Chinese-style growth outcome comes to pass, Japan would instantly qualify as the fastest growing economy in the industrial world an extraordinary reawakening for Asia's long-slumbering giant. The global implications of this development cannot be minimized: Can the world's second-largest economy lead the way in the rebalancing of a still unbalanced global economy?

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