JAPAN: “THERE HAS NEVER BEEN DATA THIS BAD FOR ANY MAJOR ECONOMY — EVEN IN THE GREAT DEPRESSION”; “WE ARE LITERALLY LOOKING AT THE UNIMAGINABLE”

February 3rd, 2009

Via: Naked Capitalism:

I have been writing about an Asian black hole for almost two months now. I have been crying from the rooftops about an emerging depression in Japan. It has been as though a neutron bomb had gone off in the world. There was no one who seemed to notice, no one who seemed to listen.

Every week it gets worse and worse and worse. Today it was Japan….

THERE HAS NEVER BEEN DATA THIS BAD FOR ANY MAJOR ECONOMY – EVEN IN THE GREAT DEPRESSION. December industrial production came in down 9.6%, worse than the METI forecast. It is now down almost 21% year over year. METI forecasts a further 4.7% decline in February. The inventory to production ratio soared again. Maybe METI will be correct.

If it is, Japan industrial production will have fallen 28% (non annualized) in four months. It will have fallen by a third in about a year. Nothing in the history of major nations compares. A 28% decline in four months would be more than half of the entire decline in U.S. industrial production over the 3 years and nine months of the U.S. Great Depression.

It would be a greater decline in four months than in any 12 month period in the Great Depression in the U.S. We are literally looking at the unimaginable. (I am attaching the U.S. industrial production index from the Great Depression for comparison).

IT’S A DEPRESSION IN JAPAN – ALREADY – PURE AND SIMPLE.

Research Credit: CP

One Response to “JAPAN: “THERE HAS NEVER BEEN DATA THIS BAD FOR ANY MAJOR ECONOMY — EVEN IN THE GREAT DEPRESSION”; “WE ARE LITERALLY LOOKING AT THE UNIMAGINABLE””

  1. tochigi Says:

    well, here in Tokyo, i woke up this morning and looked out the window, and the sky hadn’t fallen in. i rode my bike to the train station and got the train to the office, and it was just as crowded as always. manufacturing is indeed in a shit hole. “violent contraction” is not an exaggeration. but this is not the US. the social infrastructure and industrial infrastructure is still in a functional state. how bad it gets over the next 12 months will be the real test. food supply and jobs: these are the things that matter. luckily, the debt-bubble madness was done here in the 90s, so this time round it seems like it will affect Anglophone/European economies the most. but who really knows?

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