Japanese such as my in-laws are on savings plans for everything from houses to cars to college educations for the kids. Credit is not so common. The amount for each savings plan is deducted from the monthly paychecks.

The advantage is that people are not paying so much in interest charges, so their money goes farther. Additionally, their savings earns interest, adding a bit to their earning power.

The money that actually ends up in their regular accounts pays for the types of household expenses handled with cash. The annual bonus is what fuels consumer spending, since other expenses are taken care of.

David Wiesner