Wednesday March 11, 2009

Japan exports fell 45.7% in Jan 2009, economic collapse and depression next

bloomberg.com :

Japan's exports plunged 45.7% in Jan 2009 from a year earlier, resulting in a record trade deficit, as recessions in the U.S. and Europe smothered demand for the country's cars and electronics. The drop in shipments abroad eclipsed a record 35% decline set the previous month.

Exports to the U.S. tumbled an unprecedented 52.9% from a year earlier as the global recession deepened. Shipments to Europe slid 47.4%, exports to China fell 45.1% and those to Asia dropped 46.7%. The collapse is likely to force Japanese companies to keep firing workers and closing factories. Japan's GDP shrank at an annual 12.7% last quarter, the most since the 1974 oil shock. Nissan said it will fire 20,000 workers. Toyota, which is forecasting its first operating loss in seven decades, will halve production in 2009 Q1.

- As far back as Feb 2006, Japan's then-PM Koizumi had been talking about the shrinking middle class. Of course the Internet community saw this coming way before that but let's give some credit to a former PM.

And now the middle class, not just in Japan but also elsewhere, is set to shrink further or, what was once unthinkable, perhaps even disappear altogether. Let's not kid ourselves here - falls in exports of 30%, 35% or more is not just another recession. These figures are more indicative of an economic depression. If the middle class were to disappear, there will only be the poor, and the rich. Guess what happens what extremes collide. So for our own sake, let's hope for some kind of recovery before the final stages kick in.

See also :

1. Nissan to slash 20000 jobs in mass layoff, sees annual loss in 2009
2. Japan exports plummet record 35% as recession deepens
3. Toyota to cut production 54% in Q1 2009 as demand plunges
4. Japan GDP shrinks 12.7% in biggest dive since 1974 as exports collapse

(2009-03-11 19:26:37 SGT) [Biz] Permalink

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