The Japanese economy falls off a cliff, and
that is a good thing for Japan.
The latest economic data from Japan (including a 9.6% year on year fall in industrial production) would seem to indicate the Japanese economy has fallen off a cliff. Although I have not analyzed the numbers in detail, I am sure the fall in industrial production can be linked to a drop in exports to countries like the US and many European nations that have been paying for Japanese products by borrowing from Japanese citizens for the past 30 years. Losing such deadbeat customers will be a good thing for Japan in the long run, even if it seems to hurt for now.
What the Japanese government needs to do now is sell off some of its vast assets in order to reduce the national debt burden. After that they will find it easy to spend large amounts of money building things (like old folks homes) the Japanese people need. Japanese industry has also begun retooling itself to develop technologies that have been suppressed by US and European vested interests.
Japanese exports also need to pay serious attention to new markets like India and Africa to replace the European deadbeats. Of course the colonial Liberal Democratic regime of Prime Minister Taro Aso will cling to power until it is forced to hold elections in September. That means Japan’s economy is likely to remain in freefall until September.