Impact on the economy in Japan after earthquake.

Since 2007, financial crisis has occourred from America spread to the world. Even though some American citizens were the careless and inappropriate lenders, more and more them could borrow money from bank to invest on the estate market. . In order to declined the risk of these mortgages, one of collaterals, CDO was attracted by other banks and big organisation to invest it. However, the price of estate collapse caused that huge bad debts existed in banks. Then the domino effect happened by bank tightening of credit. It resulted some banks and corporations bankruptcy, or nationalisation by governments. This was not only affecting the country of America, but also a lot of country around the world, such as Japan.

"Of the six biggest fallers this year on the Global 30, five are Japanese." (BBC News, 2008) Whatever large multinational corporations and small business companies were affecting by this financial crisis. Lack of money in the banking system means no new loans lending to the company. Small company may be susceptible rather than large corporations. Because they do not have access to the capital market, and nearly half of their capital funds came from banks and other depository institutions. It led to Japan which was the worst performance country in all the Asian.

 Earthquake, a tragedy accident, occurred in Japan. Their stock market, Tokyo's main index declined 6.2% on this Monday. (Wall Street, 2011)It made the recover from financial crisis in Japan much harder than before the time. The government and public have to face a set of serious problems, such as the power shortages, public transport systems destroying, the demand of public and others. In order to solve these problems as soon as possible, Japanese government injected more than 30 trillion yen to improving internal situation. It caused their exchange rate increased while affected national exports.

In contrast, American stock market increases in NASDAQ due to increasing demand for rebuilding in Japan. They expected gained the benefits from rebuilding of Japanese infrastructure, and purchased the living standard productions. It is a beneficial opportunity to companies and consumers due to rebuild demands and exchange rate declining. Even though, Japan still can recover well efficient through other countries and national succor.