Reports out of Japan this week show that the nation's economy contracted in the second half of 1999, a flop back into recession that threatens to pull the rest of Asia, and in time Western prosperity, down with it. Coming after a hopeful spell early last year, the news signals that financial woes aren't yet behind the world's second-biggest economy. And that's bad news for countries consigned to watch anxiously from the sidelines. The newly recovering parts of Asia need Japanese buyers for their exports.
Stock markets wobble on Japan's continued bad news.
Indeed, it might seem Japan couldn't possibly try harder to pull itself out of the doldrums. Yet things are not as they appear. Many of Japan's efforts have been half-hearted, with programs sputtering out. As this week's statistics show, Japan's stimulus programs rev up the economy in the first half of a given year, then choke. Now Japan is poised to repeat the stimulus pattern with its upcoming budget.