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I have been wondering this myself and oil seems like a good explanation.

What is the explanation for Japan? They don't have oil and they have greater debt than the us (relatively), yet they haven't been met with anything worse than stagnation.

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One major difference there is that Japanese debt is mostly held by Japanese institutions. By contrast countries like Greece (and the US) have most of their debt in foreign hands. This dramatically changes the calculus there. Greece could not 'print' euros to pay off its debt, even if it wanted to. Japan can. And as a consequence of their 'nationalization' of debt, they also pay much lower interest - comparable to what we do, in fact.

Even then, I think you have keep things in perspective. 'Just stagnation' understates the situation here. In the late 80s many thought Japan was literally going to take over the world economically. Their GDP today is now lower than it was 2 decades ago. And ultimately there is still no clear path for them out of this decline.

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