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Integrity, Trust and Honesty.

The Sinking of Japan, are you ready?

NEC Corporation has started a trend that will forever change Japan. The nation's largest personal computer maker said at the end of last month it would fire more than 20 000 employees.

That announcement would have been shocking enough had it not opened the floodgates. Since then, Panasonic has said it would cut 15 000 jobs, while Nissan Motor is slashing 20 000.

Even during the darkest days of the 1990s - deflation, bank failures, public bailouts - firms avoided mass lay-offs.

NEC's precedent seems to have made it fashionable to do just that.

What's next? Sony firing 50 000 people in Tokyo? The psychological blow to already sceptical Japanese consumers is sure to deepen the recession at a speed few thought remotely possible just two months ago.

"Japan's recent economic decline is faster than that of the US, which has been experiencing its worst financial crisis in a century," Kazuo Momma, the head of research and statistics at the Bank of Japan, said on Monday.

Momma said the world's second-largest economy might have shrunk at an "unimaginable" speed last quarter.

Gross domestic product plunged at an annual 11.7 percent pace in the fourth quarter of last year. That would be the steepest decline since 1974.

There would be only one way to describe such a figure: Wow!

Remember Japan was supposed to avoid the worst of the global credit crisis. Its cash-rich banks were expected to help recapitalise Wall Street. Its firms were set to go on a merger-and-acquisitions tear.

Now, prospects for Japan are sinking like, well, the Titanic.

Source: http://www.busrep.co.za/index.php?fSectionId=553&fArticleId=4842309

"When these MNC companies announce retrenchments, it'll take 3-6 months for it to fully take effect. After that, that's when you get the real impact to consumer spending, investment etc.

With Malaysia, it's absolutely the same. It'll take the same 6 months for Malaysians to be fully hit by retrenchments and the recession. The difference is that, most workers in Malaysia still don't know they have already been retrenched. They still don't know they only have a few more months of paychecks before they're out on the street. Malaysian companies won't give you 3-6 months notice before they retrench you." Quoted from here.

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