It's economy is once again in recession when it's GDP shrank in an inflation adjusted 1.0% in the third quarter of 1999, and most economists are cetain it again shrank in the fourth quarter, with very poor consumer spending.
Below is an old story from 1998,
but it's usefull to keep up to make the point.
Sony chief slams Japanese premier; says economy is near collapse (Apr 2,1998)
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By Willis Witter
"The Japanese economy is on the verge of collapsing," Sony Corp. Chairman Norio Ohga told reporters. If Japan's economy doesn't improve, he said, it could lead to a dangerous deflationary spiral that would damage the world economy. He put the blame squarely on Mr. Hashimoto, an embattled leader with abysmal support in public opinion polls, and a few powerful cronies who keep him in power amid periodic calls for his resignation.
"What President Hoover was saying then, there are so many similarities with what Prime Minister Hashimoto has been saying recently," Mr. Ohga said.
Mr. Ohga's remarks came at the end of a day in which the stock market fell more than 3 percent in the biggest one-day drop of the year.
A monthly government report released earlier in the day led many analysts to conclude that the world's No. 2 economy had actually shrunk in the budget year that ended Monday.
Mr. Hashimoto has been under fire for months from the United States, Europe and the International Monetary Fund for allowing Japan's economy to wither at a time when, they say, it should be an engine of recovery for its crisis-torn neighbors.
In an attempt to balance the budget, Mr. Hashimoto's government raised the national sales tax last spring, a move that most analysts credit with turning a fledgling economic recovery into a full-fledged recession. At times, the rhetoric between Tokyo and Washington has been heated.
Mr. Ohga's remarks were not the first in which critics have likened Mr. Hashimoto to the late U.S. president, who is widely blamed for causing the Great Depression of the 1930s.
But when consumer-electronics giant Sony speaks, it tends to raise the volume a notch or two, especially outside Japan.
Mr. Hoover, who was president from 1929 to 1933, was reluctant to interfere with the economy and called the Depression "a temporary halt in the prosperity of a great people." He initially depended on businesses and industries to solve their own problems without government intervention.
Sony, a global company that makes everything from Walkmans to movies, has tangled in politics before.
Three years ago, Mr. Ohga replaced Akio Morita and co-wrote a book, "The Japan That Can Say No," that became a model in a debate over Asian vs. Western values. It argued that state-supported capitalism worked best in Asian cultures as opposed to the more freewheeling variety in the United States.
In Thursday's speech, Mr. Ohga apparently took a different line, accusing Mr. Hashimoto and other politicians of the ruling Liberal Democratic Party of being too insular for today's global economy.
"The problem is with Japan's politicians," Mr. Ohga said. "We are operating globally, and our prime minister should have such global thinking." Deputy Treasury Secretary Lawrence Summers recently criticized Japan for staging a "virtual" economic recovery, presumably meaning it is as real as an image on a computer screen.
The Clinton administration has urged Japan to boost its economy by cutting taxes, a prescription that some analysts liken to a 1990s version of Reaganomics.
The idea is based on the belief that Japanese consumers, if given enough cash with tax reductions and rebates, would buy exports from the crippled tiger economies such as South Korea's. Instead of cutting taxes, Japan last week decided to try to spend its way to prosperity.
Tokyo announced a major public spending package to boost its economy. The plan, worth about $125 billion, would mark the government's biggest effort yet to revive the economy.
Sony, meanwhile, seems to be doing quite well despite the regional economic crisis that began with the collapse of the Thai baht in July and forced the IMF to put together $120 billion in emergency credits for Indonesia, South Korea and Thailand.
The company said it expects to report record earnings for its fiscal year that ended Monday. Mr. Hashimoto flew to London Thursday for an Asian-European summit at which he is expected to explain Japan's prescription for healing Asia's economy.
Japan Business Confidence Slumps By William Mallard TOKYO (Reuters) - Just as Prime Minister Ryutaro Hashimoto left to give a pep-talk on Japan's economic situation to world leaders on Thursday, the nation's companies and financial markets gave the economy a resounding thumbs down.
A Bank of Japan survey found confidence at companies large and small, manufacturers and non-manufacturers alike, plunged in late March compared with the last survey in December.
With the worst headline figure in years, the BOJ's closely watched "tankan" survey of business sentiment confirmed that Japan is in a recession, economists said.
The head of Sony Corp., one of Japan's high-flying corporate stars, even declared the economy "on the verge of collapsing."
For Hashimoto, who headed off to a London summit of Asian and European leaders just minutes before the survey's release, the tankan survey was sure to make it tougher to convince the other leaders that he can get Japan back on track and lead an Asian economic revival.
Tokyo stocks logged their worst decline of the year, and the yen fell briefly to a three-month low against the dollar. "We're just starting to see Japan's darkest hour," said Jesper Koll, chief economist in Tokyo for J.P. Morgan, adding that the survey confirmed that the Japanese economy had slipped into a deep recession.
The BOJ's diffusion index for major manufacturers, a key gauge of business confidence, sank to minus 31 in March from minus 11 in December, when the previous survey was conducted.
The figure -- the worst reading since August 1994 -- was well below the average forecast of minus 23 in a Reuters survey of 18 economists and far gloomier than the minus 15 reading the companies themselves had forecast in the previous tankan.
The sagging sentiment reflected sluggishness in demand since last autumn, said BOJ statistics and research chief Masayuki Matsushima. Falling demand pushed up inventories while slumping production hurt profits, which in turn worsened a slowdown in capital spending, he said.
Big non-manufacturers logged an index of minus 30, compared with the Reuters average forecast of minus 28 and the December tankan forecast for March of minus 22.
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