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Politics : Formerly About Applied Materials -- Ignore unavailable to you. Want to Upgrade?

To: Proud_Infidel who wrote (20655)	6/22/1998 4:35:00 PM
From: Proud_Infidel	Read Replies (1) \| Respond to of 70976

Excellent article on Japan's plight. Anyone, who took business management classes in the early 90's, remember Theory Z, where Japan's biz model was held in high esteem? Wonder if they're still teaching that<GGG> exchange2000.com Excerpt: Japan was once feared for its economic might. Today it is feared for its economic weakness-and the harm its ailing system might do to the rest of Asia and the world. Just how sick is Japan? SOON, and for the first time, Japan will have a higher jobless rate than America-a telling moment in the shifting fortunes of the two economies. While America continues to enjoy rapid growth, Japan is in recession. The country's GDP fell by an annualised 5.3% in the three months to March-much more than expected and the second consecutive quarterly fall. Its banks are creaking under their burden of bad loans; this week the yen hit an eight-year low of 147 against the dollar, before joint intervention by America and Japan pulled it back; the unemployment rate, with further to rise, already stands at a post-war high of 4.1%. Things will probably get worse before they get better. Consumer and business confidence is severely depressed. Worries about jobs and the fragility of financial institutions is likely to cause families to save more and spend less in coming months, adding to fears of a self-reinforcing deflationary spiral. Firms, struggling under a mountain of debt and excess capacity, are slashing investment, and exports to the rest of Asia are falling. Over the next year or so more firms will go bust, unemployment will climb, and the scale of the banks' problems may well turn out to be even worse than has been admitted so far. If the recession in the rest of Asia deepens or if America's economy-tripped by a sharp fall on Wall Street, say-falls suddenly into recession, then Japan's economic prospects will look grimmer still.