Japanees Article

The earthquake and tsunami disaster in Japan threatens to slowdown the nation’s economic recovery and it possibly spreading to other countries. However, the extent to which it could harm the global economies cannot be assessed. It can be noticed that there are two threats that can be emerged to the Japanese economy; the domestic power supply could be compromised and manufacturing companies could be incapable to export its products. Honda, Toyota, Canon, Panasonic and others , have already halted significant portions of their output. In addition to that, Japan’s stock market reached its worst drop.

Some major comments can be drawn from this article which are:

1. Loss of income, production and output are the results from Japan’s natural disaster.

2. When factories destroyed, employees will not work and so the production will drop.

3. Manufactures will find alternate ways of transporting products from one place to another since the regular distribution channels are disturbed

4. Since Japan is considered a net exporter, it will not be the only one that is affected. A shortage in electronic components forced General Motors to suspend production at facilities in the United States and Europe.

5. The bank of Japan has pumped amount of cash since the earthquake. We think that the problem here is not weak demand, it is reduced supply. In other words, banks printed money so that more money buys fewer goods and services and this is what we called inflation.

6. Major reconstruction will be needed to the agriculture and fishing industry in the strongest effected area, Sendai, However, investors think that since the prices of major commodities (such as rice) fell, Japanese agricultural production would be disrupted.

7. The collapsed nuclear plants may increase the demand on other types of energy (oil, gas, coal) which might increase their prices.

8. People will start to rebuild, however the downturn will be more than offset by new investment and construction...