Falling Exports Hurt Japan
NY Times – Gloom Grows for Japan’s Exporters
“Unfortunately, the probability is very high that exports will stop supporting the Japanese economy,” said Akio Makabe, an economist at Mizuho Research Institute. “It all depends on the American situation. If the U.S. economy deteriorates, it will be a big problem for Japan.”
Here’s the “perfect storm” for Japan: sinking exports, domestic recession, banking sector immobile. If Japan had dealt with their recession 10 years ago, when the rest of the global economy was still growing, they would not have had the additional problem of falling exports to make reform that much more difficult.