At a time when Tokyo is struggling to curb its huge debt, the earthquake, tsunami and now the nuclear meltdown is sure to hurt Japan’s economy in a big way, says renowned economist Nouriel Roubini. He feels that given the uncertainty over the developments in Japan, people are fearing the worst.
Concerns in Japan are impacting global markets too. "There is an urgent need for transparency; people need to know what is exactly happening. Conflicting reports and no exact information about how bad the situation is, is not going to be beneficial for the confidence of the mass or the market," Roubini, who had predicted the onset of the global financial crisis in 2008, points out.
Also, we are now on the verge of being worried about a nuclear meltdown, and that certainly is not good for business, he states.
To which Paul Sheard of Nomura adds that these kinds of disasters cause a lot of short-term disruption with the GDP being hit and capital stock and wealth being destroyed. But this also leads to reconstruction efforts, capital stock being re-built, and one tends to get a bit of a bounce-back. "Economic recovery may be delayed by a few quarters in Japan on account of huge uncertainty and we would see suppressed growth in the April-June quarter
Concerns in Japan are impacting global markets too. "There is an urgent need for transparency; people need to know what is exactly happening. Conflicting reports and no exact information about how bad the situation is, is not going to be beneficial for the confidence of the mass or the market," Roubini, who had predicted the onset of the global financial crisis in 2008, points out.
Also, we are now on the verge of being worried about a nuclear meltdown, and that certainly is not good for business, he states.
To which Paul Sheard of Nomura adds that these kinds of disasters cause a lot of short-term disruption with the GDP being hit and capital stock and wealth being destroyed. But this also leads to reconstruction efforts, capital stock being re-built, and one tends to get a bit of a bounce-back. "Economic recovery may be delayed by a few quarters in Japan on account of huge uncertainty and we would see suppressed growth in the April-June quarter
No comments:
Post a Comment