Japan slips into recession, becoming the 4th-largest economy, behind the US, China and now Germany.
Japan’s economy is now the world’s fourth-largest after it contracted in the last quarter of 2023 and fell behind Germany.
The government reported the economy shrank at an annual rate of 0.4% in October to December, according to Cabinet Office data on real GDP, though it grew 1.9% for all of 2023.
It contracted 2.9% in July-September. Two straight quarters of contraction are considered an indicator an economy is in a technical recession.
Japan’s economy was the second largest until 2010, when it was overtaken by China’s. Japan’s nominal GDP totaled $4.2 trillion last year, while Germany’s was $4.4 trillion, or $4.5 trillion, depending on the currency conversion.
Truth is they are both going down at a different pace.
Germany just passed a €72 billion defense budget. As they say: “When the economy is sore, join a war.”
Did you miss the developments in Eastern Europe that necessitate this increase in spending?
No. Just pointing out that military spending is a very efficient way to increase economic activity. The US economy would not be doing very well if it wasn’t for all the military spending.
But Germany is doing it without putting it all on the big credit card like the Americans, so I’ll take Germany’s economy and well-advised budgeting any day of the week.