The clearing up of bad loans will not be carried out in order simply to overhaul the general contractors. The bad loans of troubled banks and life insurance companies will be processed along with firms belonging to their respective groups in the distribution, real estate, housing, and construction sectors. The main banks of the general contractors have been acting as their refuge of last resort. Yuji Shimanaka, director, investment research department, Sanwa Research Institute and Consulting. Economist, August 7, 2001.
Many economists expect the Japanese economy to continue declining.
This view is based on a number of factors. One is that the index showing the profitability climate hit bottom in February this year. Another is that the U.S. economy, which has a great impact on the Japanese economy, could begin to recover in the fall as a result of monetary relaxation and tax cuts. Because of the unusually hot summer, moreover, personal consumption has recovered somewhat. Housing demand is steadily increasing, and oil prices have tumbled from 37 dollars a barrel last autumn to around 25 dollars.