Home > XE Currency Blog > Japan Enters Technical Recession

AD

XE Currency Blog

Topics6678 Posts6723
By HaleStewart November 17, 2014 8:40 am
  • XE Contributor
HaleStewart's picture
HaleStewart Posts: 792
Japan Enters Technical Recession

Above are the seasonally adjusted totals for Japan's GDP components based on 2005 chained yen figures.  While the overall level of contraction is obviously concerning, there are several other troubling figures, starting with the very sharp drop (-6.7%) in private residential investment.  Residential investment is a prime driver of most developed economies.  This means the Japanese economy is facing serious potential headwinds going into the fourth quarter.  The .5% overall drop in demand also raises red flags.  And finally, there is the drop in inventory investment, which shows that, overall, companies are scaling back activity.

This report is very troubling.  

Hale Stewart is a former bond broker who has been writing about economics and financial markets since 2006 on the Bonddad Blog.  He is also a tax attorney with a domestic and international practice while also forming and managing captive insurance companies for US companies.   You can follow him on twitter at:@captivelawyer

 

Replies: Japan Enters Technical Recession

▲ Sort Comments
    admansmithnot's picture
    admansmithnot Posts: 2

    The real problem is that it appears that those in power don't know what they are doing. What can Japan do now: nothing, or is this a failure of leadership?

    Paste link in email or IM