One reader wants to compare the current US housing bubble with Japan's. "I don’t know if you’ve ever discussed this but I’m interested in hearing about the differences & similarities between the U.S. today and the peak and decline of Japan’s real estate."

From the Times Online. "After a decade and a half of recession, deflation and national funk, Japan may be bouncing back. If so, it has much to do with couples like Masaaki and Mikiko Isozu. Like young Japanese families across Tokyo, they have just reached a momentous decision. After years of renting, they have decided to buy a home."

"But the Isozus’ excitement is tempered by a deep caution. The anxiety can be summed up in a single word, 'bubble,' the period of high growth in the late Eighties that burst so disastrously in the early Nineties and pitched Japan into 14 years of economic stagnation. 'When it comes to property, we can’t shake off the memory of the bubble,' says Mr Izozu. 'Could this be another bubble? We can’t be sure of the recovery yet.'"

"The evidence suggests that, after several false dawns, Japan’s economy is expanding once again. Yesterday the Government announced that consumer prices were rising for the first time in eight years. Unemployment is sinking. Across the capital, old buildings are being demolished to make way for new shops, offices, hotels and homes."

"But, however encouraging the figures, this will be a recovery very different from Japan’s last period of high growth. No one of the Isozus’ generation can forget the disastrous popping of the bubble economy in 1992. Intoxicated by surging asset prices, banks lent money on the back of apparently unquenchable property values."

"When the bottom fell out, debtors found themselves unable to meet repayments. Bankruptcies, unemployment, homelessness and suicides soared. The job of writing off bad loans, streamlining companies and dealing with the surge of dismissals and bankruptcies took more than ten years, the so-called 'lost decade' in which the economy was further damaged by a spending slump."

"Little wonder, then, if many people are watching and waiting. Japanese are the world’s most assiduous savers, but after 14 years of recession, a quarter of households have no savings. Such families are likely to use their salary rises and bonuses not to buy new cars and flat-screen televisions, but simply to replenish bank accounts."