This hasn't been a good week for the Japanese economy. Last Wednesday saw China officially overtake Japan as the second largest economy in the world as measured by GDP. Today saw the Nikkei Index fall below the 9000 yen level, its lowest in 14 months. To put this is perspective, at the height of the economic boom here back in the late 1980's, the Nikkei reached a high of 38,957 in 1989. Then everything went remarkably pear shaped, $16 trillion worth of paper wealth evaporated (almost three times the country's gross domestic product), and two decades later, the economy hasn't even clawed back a quarter of that yet.
All this provides an object lesson for those back home who think that in another 12 months or so Ireland will snap back out of recession, find its feet, and start lurching back to recovery. If it hasn't happen for the world's second, sorry, third largest economy after nearly 20 years of trying everything bar selling itself to the Chinese*, then what hope for a small island economy on the periphery of Europe.
The Economist has two good articles on Japan's ongoing woes, one here on the decline of Japanese firms
And one here - actually a book review - on the societal changes all this has resulted in.
*(though they're probably waiting a little longer for a Japanese-Government-staves-off-imminent-collapse-everything-must-go-bargain-basement-sale).
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