Japan is even worse than the economic data suggest

"Since April 8th, the Japanese yen has been the strongest of the major currencies. Yet as is often the case, the yen's performance in the foreign exchange market  does not appear to be a reflection of the Japanese economy.

On the contrary, the situation in Japan is arguably even worse than the somber economic data would suggest. The power shortages and damaged factories are taking a larger toll than was initially evident. Press reports, for example, warn that the contagion via the supply chains may have greater global impact, which in turn could impact the manufacturing activity outside of Japan. Toyota, the world's largest auto producer, has indicated that its output collapsed by nearly 2/3 in March compared with a year earlier. Honda's loss of output was similar while Nissan reports its auto output was cut by a little more than half. One press report indicated that Toyota will cuts its output from its Melbourne, Australia plant by half this month and next, citing a shortage of parts that were to be shipped from Japan.

While the disruption emanating from Japan will hit other auto sectors on the margin, the disruption of the Japanese economy itself appears more severe. Moody's today revised this year to 0.0%-1.0% from 1.5% and with downside risks..."

at http://www.creditwritedowns.com/2011/04/japan-is-even-worse-than-the-economic-data-suggest.html#ixzz1KZ4mD6cC