Japan could miss fiscal target even with 3% economic growth: gov't document

Japan will miss its target for cutting its fiscal deficit even if it achieved nominal economic growth of 3%, unless there are further cuts in spending, according to a government estimate obtained by Reuters on Monday

So all of you economic gurus/Japanophiles who say Japan's debt is no problem since most of it is held domestically may have missed just one small point. That being the the absolute size of it has become so large, that with a shrinking/aging population and a declining economy they are unlikely to reach a primary budget balance under the best of circumstances -- in a decade.

The article isn't very clear about the conditions, but it seems that a sustained economic growth of 3% or above over many years is completely unrealistic. If Japan cannot achieve a primary budget surplus even under such best-case assumptions, can we conclude that the public debt has passed beyond the point of no return? Furthermore, at some point of not so distant time, public debt will reach the level of total savings in Japan. There are estimations ranging from 2016 to about one decade later for that to happen. From that point onwards, Japan will be forced to rely of foreign creditors to finance it's debt, with ever increasing interest rates.

It looks like the only way to get out of the debt spiral is inflation. How much inflation is needed? How can you make sure an entire generation isn't deprived of their retirement savings?