On February 8, 2009, David M. Smick wrote an op-ed in the Washington Post which called for Japan to bail out America. Japan, after all, had the largest amount of excess savings in the world, and it presumably wanted to lower its currency which, over the past 18 months, had strengthened 30% against the dollar as Japanese investors sold their overseas bonds and repatriated the money. The strong yen, coupled with collapsing overseas demand, had badly damaged Japanese companies.
Were the Japanese government to start selling yen and buying dollars and buying U.S. government bonds with those dollars that would both lower the yen and at the same time, bail out America.
I don’t think Japan liked that bargain.