Tuesday, Mar. 10 2009 @ 4:42PM
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| Intoxicated by his failure last month: Finance Minister Nakagawa. |
We have every right to whine about our economy, and so do you Brits and particularly you Icelanders. But Japan is in free-fall.
One way to tell is that profit-takers are circling. Over at the Daily Crux, a recent headline proclaimed, "The world's biggest bankruptcy is coming...here's how to profit," and the site referred you to Tom Dyson's rant on Steve Sjuggerud's Daily Wealth:
...The "debt clock" measures the amount of money the government owes its creditors. Today, the U.S. debt clock reads $11 trillion. To pay off this debt tomorrow, the government would have to collect $36,000 from every American.
But America is NOT about to be the world's biggest bankruptcy.
Of the major industrial economies in the world, Japan's government is the most indebted.
Since its recession began 20 years ago, Japan has plowed trillions into its banking system via numerous bailout programs. Japan's mantra is growth without cost. As a result, the Japanese government has built up the world's most crippling debt load.
The government of Japan owes $7.8 trillion. That's $157,000 per capita.
Too much hysteria? Not really. This morning's Wall Street Journal, in "Japan's Nikkei Slides as Economy Weakens," gives us a story that's far scarier than that bland headline. Alison Tudor writes:
Japan's economy, already contracting at an alarming rate, received a fresh blow Monday as its stock market sank to 26-year lows and plunging exports led to its first current-account deficit in 13 years.
Remember the country's finance minister, Shoichi Nakagawa — the guy in charge of the world's second-biggest economy — who appeared so drunk at the G20 last month that he was forced to quit? He was the right-hand man of Prime Minister Taro Aso, who is believed to be the most unpopular leader in Japanese history.
Nakagawa undoubtedly help screw things up in Japan, but can you blame him for getting drunk?
Today's WSJ story comes on the heels of a BCA Research piece last week, "Japan: Economic Implosion!," which pointed out:
The Japanese manufacturing sector has collapsed, and further production cuts lie ahead.
Industrial production plunged 10% in January, on the heels of a similar decline in prior months. Output has contracted a mind-boggling 25% in the past three months, exceeding the rate of decline in U.S. production at any point during the Great Depression.
"Severely depressed" for months — that's the prognosis for Japan. But the global despair is so immense these days that even the global beer barons are crying in their beer.
Anheuser-Busch Inbev, the world's largest brewer said the other day that it would "sell off assets, cut costs, suspend executive bonuses and slash its dividend to pay off debt," because of a sharp drop in quarterly profit.
Likely to be ditched, says the WSJ, are theme parks SeaWorld and Busch Gardens, along with other parts of the global beer empire.
