Japan faces ‘unimaginable’ contraction(annualized GDP fall: -10%)

FT ^ | 02/09/09 | Mure Dickie

[TigerLikesRooster]

Japan faces ‘unimaginable’ contraction

By Mure Dickie in Tokyo

Published: February 9 2009 15:04 | Last updated: February 9 2009 18:46

Japan’s economy faces an “unimaginable” contraction, the chief economist of its central bank warned on Monday, as figures revealed surging bankruptcies and a big fall in machinery orders.

The warning from Kazuo Momma, head of the Bank of Japan’s research and statistics department, underscored the gloom surrounding the world’s second-largest economy as export orders dry up, companies shut down production lines and consumers stop spending.

Japan, where industrial output plunged a record 9.6 per cent month on month in December, is due to announce fourth-quarter gross domestic product data next week. Polls of economists suggest GDP will have fallen more than 3 per cent compared with the previous quarter – an annualised decline of more than 10 per cent.

[This_far]

Sometimes you have to make light of a situation.

(para) ‘We must learn to make these smaller.’

(Japanese are trying to stuff the radio down the hatch. 1941)

[RSmithOpt]

And let's not forget our spendthrift drunken horde we call Congress, neither.

I am beginning to wander exactly just how fast the snowball is going to pick up speed heading down the hill at this time.

I don't read anything that bodes good news at this time for the economy, especially after the Porkulus orgy.

[wmfights]

CompSci people have a term for this type of “resource contention” in concurrent programming systems: “the fatal embrace.”

It's well named.

If these nations stop buying our paper a large portion of the globalized economy turns in on itself. In short order they will have to find dependable trade partners for the things they don't do and a restructuring will occur with us on the outside.