Japanese Economy Crumbles
Three decades ago Japan was a rich country with a dynamic economy. Middle class citizens drove flashy European cars, bought expensive apartments and vacationed in Hawaii . 30 years later Japan's economy is coming down. People don't travel that much any more, start buying small domestic cars and spend the holidays at home. Some Japanese even have trouble paying the mortgage on their house.
Only a few nations have witnessed such a dramatic decline. Japan was Asia's big success story in the 70s and 80s, but then came stock and land speculation. Real estate prices rose into the sky and the bubble eventually burst.
For almost two decades the country has been in a downward fall. Consumers don't buy any more, banks sit on money that nobody wants and instead of spending and investing big companies and corporations cut their debts. Experts call this deflation . It has caused the Japanese to be more careful when they spend money,
For young Japanese citizens it is hard to imagine that times were different two or three decades ago, when Japan was the mightiest country in Asia. Japanese industries, from automakers to computers, dominated world markets. The Tokyo stock market was among the strongest in the world and the yen rose to great heights. Japanese companies went on a spending spree, buying up everything they could find in America and Europe.
In the early 1990s economic experts predicted that Japan would overtake the United States as the number one economy. But, in fact, it was Japan that was overtaken by rival China, Asia's biggest economy in 2010. Many industries stand no chance against companies from South Korea or China.
The change has also affected Japan's population. People are not as energetic and lively as they were two decades ago. Many of them are pessimistic and have lost the vitality of the 70s and 80s .
The biggest problem is that the Japanese are holding on to their money, not willing to spend anything and risk becoming bankrupt. As a result, prices have gone down, the value of the yen in the country has risen. Everything is on sale, but still people, don't buy. In some cities night clubs and bars have had to close because there are no customers any more. Since the real-estate bubble burst land prices have been falling as well.
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- affect = influence, change
- burst = break open
- citizen = a person who lives in a country and has rights there
- consumer = a person who buys something
- corporation = a big company a group of companies
- crumble = fall apart
- debt = the money that you owe to somebody
- decade = a period of ten years
- decline = to become weaker, go down
- domestic = here: cars that are produced in Japan
- economy = the system by which a country’s money and goods are produced
- energetic = to have a lot of energy
- flashy = bright, expensive
- mighty = powerful
- mortgage = you borrow money from a bank in order to buy a house and pay it back over a period of many years
- overtake = to develop and grow faster; to become more successful than your rival
- predict = to say that something will happen in the future
- real estate = land, property, houses and flats
- rival = the organization or company you are competing against
- speculation = when you try to make a big profit by buying goods or land and selling them at a higher price
- spending spree = short time when you go to places and buy as much as you can
- stock = small part of a company
- stock market = place where shares of companies are bought and sold
- vacation = to spend your holidays
- vitality = strength energy to do something
- witness = experience, see