While Japan appears to be making progress in resolving the situation at the damaged Fukushima nuclear power facility, the idiosyncrasy of the Japanese power grid and the nuclear industry’s checkered history could contribute to further undermining the struggling government’s already shaky credibility. In the words of one young Japanese woman acquaintance, "I don’t trust them […]
The earthquake and tsunami that devastated the Tohoku region of northern Japan took place against a challenging economic backdrop for Japan. Before tragedy struck, the country was already facing a slowing economy, fiscal strain, and deflation. The costs of this disaster are still being counted, and the nuclear power plants represent a wildcard. Yet rebuilding […]
In January, we calculated the likely impact of the global economic crisis by comparing the International Monetary Fund’s (IMF) growth forecast for the crisis years with the average growth in the precrisis period of 2005–07. Given the release of new growth forecasts, we update our exercise here, but focus on the forecast for 2009. Three […]
The economic news is grim the world over, but is it equally grim everywhere? Based on the latest update of the IMF’s World Economic Outlook (January 2009), we estimate which country groups and countries are expected to see the greatest decline in growth during the crisis compared to their precrisis performance. In the table below, […]
The dollar is depreciating in eye-catching and headline-grabbing fashion. The Japanese authorities are signaling that they are prepared to intervene. The G-7 (remember them?) has the established role of coordinated intervention in major currency markets when things get out of hand. So where are they now and when will they come in?
Should the United States be concerned about ending up like Japan in the 1990s? There are signs that American policymakers are worried about just such a development. By this they and other economists mean the threat of an extended recessionary period of sub-par growth, and an inability to sustain a recovery, apparently because of bad assets weighing down the economy’s financial system. Last week’s lock-up in the US commercial paper and short-term lending markets for solid non-financial corporations, reminiscent of what preceded the real economy nose-diving in Japan in 1997-98, made the prospect all the more real.