Japanese Economy Collapses: Q1 GDP Drops At Double Consensus Rate, Epic Nominal Plunge Of -5.2%

Tyler Durden's picture

Confirming once again that Wall Street economist (and sell side in general) is the most useless profession in the world (though gladly accepting a 7 figures compensation), is the latest data out of Japan which is yet another stunner to most, as nobody, nobody, could have possible predicted that the Japanese economy would literally fall off a cliff in Q1, plunging at a 3.7% rate (down from -3% previously), which is double the consensus print of -1.9%. DOUBLE. And in nominal terms the collapse was simply epic: -5.2%! And yes, this is officially a recession. Of course, anyone reading Zero Hedge would have been perfectly aware of this outcome. 4 short days ago we said: "Increasingly we have come to believe that the real marginal economy over
the next several quarters will be neither that of the contracting US,
nor that of the rapidly tightening, yet still very much inflationary
China, but the (arguably) third largest one: that of Japan." Today our prediction is more than confirmed. And instead of hiding deep in the whatever holes these morlocks cralwed out of, Bloomberg for some inexplicable reason continues to look to their blatantly horrendous opinion. “The negative economic impact from the disaster will be on full display during the second quarter,” Hiroshi Watanabe, a senior economist at the Daiwa Institute of Research in Tokyo, said before the report. “This recession may be deep, but short.” Yeah, sure. Short. We'll just hold our breath. And for it to be short, it means that the BOJ will be forced to print a few hundred trillion in Yen asap (just as we predicted here and here) right? Which in turn means that the USDJPY will surge and shift the Japanese recession even faster over to the US. And yes it means that the turbo print button among the central banks will get the F5 treatment as the second round of currency devaluation completes a lap.

Some more much delayed reality:

Highlighting the disaster’s effect on companies, Toyota Motor Corp. said profits plunged while Nippon Steel Corp. reported its first net loss in six quarters, after the quake closed plants, cut supply chains and caused power shortage.

Factory output fell by a record and retail sales and exports declined in March because of power shortages spurred by a nuclear accident in Fukushima, northeast of Tokyo, and damage to transportation facilities after the temblor.

“It’s hard to think that companies will become aggressive about increasing business spending when uncertainties remain strong,” said Junko Nishioka, chief economist at RBS Securities Japan Ltd. in Tokyo. “Capital spending will likely be in a declining trend as corporate profits may do worse than expected.”

Capital investment dropped 0.9 percent in the first quarter, the first decline in six quarters, today’s data showed.

Consumer spending fell 0.6 percent in the January-March period from the previous three months, today’s report showed.

But since the conspiracy of optimism needs its daily fix, there is of course a hopey-changey silver lining:

We look for a classic V-shaped recovery in the July-to- September period and after,” said Kyohei Morita, chief economist at Barclays Capital in Tokyo. “A self-sustaining recovery in production, an increase in government consumption and reconstruction demand centered around public works will likely support the economy.”

Frontal lobe bleeding may now commence.


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CPL's picture

There she is.  The most glorious of the black swans, followed by the four horsemen right behind it.

anynonmous's picture

which is why the nikk is +

Long-John-Silver's picture

Is this the same Black Swan that DSK raped?

Problem Is's picture

"followed by the four horsemen right behind it."

  1. The Bernank...
  2. Wanker Timmay Jeethner...
  3. Boner Strauss-Kahn...
  4. Obama Bin Lyin'...

Those are four dumb fuckers who could trigger an apocalypse...

MsCreant's picture

Bone-her Strauss-Kahn

Fixed that one for you.

Michael's picture

The Schadenfreude derived from this nice get of an elitist scumbag has never been more pleasurable for me.

Schadenfreude, German word, is pleasure derived from the misfortunes of others.

When I think about how a lowly HIV Goy put an elitist Jew god in prison, well, makes me cum in my jeans.

Michael's picture

That is the most perfect video example of what Schadenfreude looks like I have ever seen in my entire life.

Thank You.

Herman Strandschnecke's picture

 But the joy is that you probably watched that clip for half an hour :)

Michael's picture

It was only 20 minutes of viewing pleasure for me while doing my fantasy dance. I'll catch up tomorrow on it some more. :)

Let me just add; it was a black female African immigrant who did that elitist aristocrat scumbag in for his own indiscretion. Trolololololol. :)

Hephasteus's picture

The elite have become so intensely scummy that no amount of misfortune could produce pleasure in anyone. They have gone way past the point of tit for tat redemption. That's what happens when you double down on the I'm not fired you're fired. I'm not dead your dead once often.

Spirit Of Truth's picture

True art!

Someone should redo that video with a head shot of Bernanke superimposed over the singer's head and then have gobs of $$$ being thrown around the room as he walks about.

pan-the-ist's picture

That would ruin it.  How can you not smile and be happy while you watch trolololol?  Though indeed the Bernanke probably sings that as he dishes out the cash.

Jendrzejczyk's picture

...have triggered the apocalypse...

Jendrzejczyk's picture


Hoping things are improving for you.

(Double post save.)


DoChenRollingBearing's picture

JIT issues from Japan have just affected a small bearing importer in Peru.  We thought we would get a vital piece, but no.

See comment #1290247 below thread.  Not good for us.

The Bearing thinks that JIT issues have merely JUST BEGUN.


JIT issues out of Japan could be a really bad surprise that few are contemplating...

And, yes, my heart also hurts that the people of a great nation were LIED TO and screwed by their .gov and TEPCO.

Teamtc321's picture

Geithner: Another Meltdown is 'Certain' — Raising Taxes on the Wealthy Will Come

And he blamed a combination of timid politicians and credit card-debt-ridden Americans, rather than Wall Street and the big banks, for the financial woes that have beset the country over the past three years.


Widowmaker's picture

Q: Whats the difference between Tim Geithner and a bucket of shit?

A: The bucket. 

fajensen's picture

... And Geitner holds more shit than the bucket!

three chord sloth's picture

Hey... that's a good idea. Let's lend them to Japan! A trans-pacific gesture of friendship.

No, really Japan... we wouldn't mind letting you keep those guys for a while. We can suffer through without them for a year or two... or three. They'll get you humming along in no time!

Seriously, Japan... you can have them. It's the least we can do.

How about if we say "pretty please"...?

jus_lite_reading's picture

That was funny. Now what bastards junked you for that? The Problem Is, me thinks we've got us some trolls about.

mophead's picture

We know what this means... RALLY!!!

lsbumblebee's picture

Yes but those numbers are better than expected.

Quixotic_Not's picture

Wait for Bloomturd to print "unexpected" when they run their feel good spin on Japan's depression print!

Banana Ben is warming up the QE helo as we speak...

Problem Is's picture

The Bernank: "Quick Robin! To the Fed Copter!"

Timmay Jeethner: "Holy QE3 Fedman!"

Sisyphus's picture

But let me guess, Nikkei is up, right?

Gordon Freeman's picture

Of course!  This is all very, very bullish, doncha know?

EscapeKey's picture

Predictably not covered by Marketwatch whatsoever.

And the Keynesian shills will now all state "all priced in", completely ignoring that they were all jumping with glee over the "expected strong growth" on the back of rebuilding, less than a week ago.

The report should be written by Fred Mishkin, and we'd be all complete.

/Sick & disgusted.

You Lie's picture

No one could have predicted this?   What rock have you been hiding under?

You Lie's picture

Bazinga!   Leonard is supposed to inform me of these things.

Re-Discovery's picture

umm . . I believe TD was being sarcastic  . . uh . . .yeah

urbanelf's picture

Look for the classic mushroom shaped recovery.

Cursive's picture


Look for the classic mushroom shaped recovery.


GOSPLAN HERO's picture

Total collapse!

Mega money printing now.

Quixotic_Not's picture

Gonna need QE4 a month later with all the Treasuries the Japanese are going to be redeeming!

Lowry Lon!

Long-John-Silver's picture

Lots of Jew confetti will be flying.

ElvisDog's picture

And how exactly would money printing rebuild their electric grid?

Incubus's picture

They don't need an electrical grid anymore.  They can just tap the radiant energy right out of their environment. 


sabra1's picture

so, why are their stocks up? is there an ETF for radiation?

djsmps's picture

Bank of Japan stimurus.

Caviar Emptor's picture

The financial sector gets new cash while the economy is allowed to collapse, like in the US

Rynak's picture

Thats not so different to radiation.

WonderDawg's picture

Thanks, man. That was just the sort of understated zinger I needed for a good chuckle.

Rynak's picture

but.....but..... they said...... how could a big earthquake, tsumami and nuclear disaster result in this? I don't understand anything anymore.