At least not the way that Americans are viewing it. There have been many, many comparisons in the media to the Great Depression, the worst economic climate in the past 70 years, etc. but the reality is that this is only slightly worse than normal for the Japanese (especially in the context of the last 20 years). With the release of consumer confidence numbers yesterday, it's interesting to see the Japanese consumer reaction.

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As we can see, employment is only slightly worse than many of the spikes in the 90s; the other numbers are also marginally worse but not indicative of a new paradigm in the macro picture.

What is interesting though is that consumer sentiment has been at or below the 50 level for the past 27 years. One would assume eventually that consumer confidence has to rebound; this is somewhat related with our previous articles on the Japanese consumer. As we've covered the various factors associated with the recovery of Japanese demand, we won't rehash but it is worth reiterating that it could be a critical factor in picking up the slack from the increased savings rate in the US. Stay tuned...