Asia tanking tonight. One really has to wonder if a 3/4% cut in interest rates, which takes 18 months to work it's way through the system, has cured what Rubin called the worst economic crisis in 50 years. Not....................
Bank of Japan survey shows worsening business sentiment
7.44 p.m. ET (0044 GMT) December 13, 1998
TOKYO — Business confidence at Japan's recession-hit small and medium-sized manufacturers has fallen to a record low, a quarterly central bank survey released Monday shows.
Sentiment surpassed the level recorded in September, which was the worst since the Bank of Japan's widely watched "tankan'' survey began in 1967.
The index for those companies came to minus 60, worse than the previous record low of minus 57 in the last survey released in September. The September figure had exceeded the prior record low of minus 51 in May 1975.
Confidence at major manufacturers also continued to worsen, falling to minus 56, the worst since February 1994 when it reached the same level, according to the central bank. The September survey registered a minus 51.
The survey's main index measures the percentage of firms seeing business conditions improve minus the percentage seeing conditions worsen.
The Bank of Japan surveyed 9,129 companies.
Japan is stuck in its worst recession in half a century, its economy dragged down by massive bad loans in its financial sector and sales dampened by the Asian currency crisis as well as by pessimism among consumers at home.
Bankruptcies among companies have risen as well. Smaller companies have been hit the hardest because they are more dependent on bank loans to finance their businesses.
"We have seen the economy worsen in the past year, but we cannot expect a dramatic turnaround because consumption remains quite weak,'' said Naomi Hasegawa, senior economist at Tokyo-Mitsubishi Securities, in reaction to the survey results.
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