I. A
Few More Important Moments
- 1989
Japanese stock market and real estate market peak.
- 1993
LDP loses majority in lower house of Diet.
- 1997 Asian Financial Crisis
II.
What went wrong? Take your pick:
- Speculative
bubble burst; the manufacturing economy remains sound.
- Overoptimism
of many years of growth led to lax regulation, eventually
to banking crisis.
- Keiretsu
system has proven inflexible, encouraged poor investment
practices with little regard to market changes.
- Aging
population requires tax increases to provide for social security
programs, which have delayed economic recovery.
- Fear
of inflation (partly for demographic reasons) has caused
the Bank of Japan to restrict the money and to create a "liquidity
trap" in which interest rates approaching zero were not enough
to stimulate recovery.
- The Japanese
economy has matured and is losing jobs to less expensive
labor markets just like the US.
III.
For more ...
|
Charts
from "The
Nonperforming Country,"
The Economist (Feb.
15, 2002) |
