Deflation, Double Dips and Lost Decades – Japan in Fresh Warnings but are they all they’re cracked up to be?
Weak domestic demand has caused the world’s second largest economy to enter “a mild deflationary phase”, the government said in its November monthly economic report released last Friday. And today Japan’s Prime Minister suggested that his country risked falling back into a “double-dip” recession. Analysts are sceptical though. They believe that the recent warning may have been more political than anything else. The newly elected Mr Hatoyama may be trying to drum up a bit of fear in order …
Weak domestic demand has caused the world’s second largest economy to enter “a mild deflationary phase”, the government said in its November monthly economic report released last Friday.
And today Japan’s Prime Minister suggested that his country risked falling back into a “double-dip” recession.
Analysts are sceptical though. They believe that the recent warning may have been more political than anything else. The newly elected Mr Hatoyama may be trying to drum up a bit of fear in order to get through more unpopular stimulus measures.
The threat of a double-dip recession, said analysts, may be the “scare tactic” needed to push through the necessary budget.
How could they be so cynical.
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