Japan's Natural Disaster Hurts Economy

On March 11, 2011, Japan was devastated by a natural disaster that struck the Japanese economy. The 9.0 magnitude earthquake and tsunami devastated the northeastern coast and triggered a crisis at a nuclear power point. The Bank of Japan is conducting operations that are helping the rise in demand for post-disaster funds. Japan’s bank is taking cash from money markets and bringing its emergency funding to nearly seven hundred billion dollars.

The government had ordered workers at the nuclear plant to withdraw from a stricken nuclear plant in Japan due to a surge in radiation. The government ordered the temporary efforts to cool the overheating reactors for safety reasons. There will be a decrease in work and income for workers at the plant causing a decrease in income and future purchases for local business's. The nuclear crisis has triggered international alarm, its emergency at the nuclear plant is partially overshadowing the earthquake at this time, but both emergencies are affecting the economy in a negative manner.

The devastation has increased demand for fuel and food. Local supermarkets were cleared out after the disaster and Japanese civilians are not compliant having lost loved ones and not having food for the family that has survived. With a decrease in quantity, prices will rise in Japan until the economy can get back on track. In the automobile industry there is a power supply shortage that will slow down production. With a decrease in demand for automobiles due to higher prices of fuel, Japan is displaying an inward shift. Inward shifts in demand are usually due to famine or in this case natural disasters

The Japanese government is stepping in during a crucial time to take part during the market failure. I have not doubt that in time the Japanese government and Bank of Japan will build back up the country to what it originally has been. The billions of dollars going in to Japan will only benefit the country. With outside help from surrounding countries, states like Iwate, Miyagi, Fukushima and Ibaraki, which have been hit the hardest will see a brighter future. I think it will be impressive to see the progress Japan will make after a year compared to when Hurricane Katrina hit the United States of America in 2005. The reconstruction of New Orleans was a slow progress in the United States and I believe Japan will be determined to build up the economy much faster.

http://news.yahoo.com/s/ap/20110316/ap_on_bi_ge/as_japan_earthquake_economy;_ylt=Apm1PqdCEaLivvCBxynJcWTv5rEF;_ylu=X3oDMTMxZmpvazFjBGFzc2V0A2FwLzIwMTEwMzE2L2FzX2phcGFuX2VhcnRocXVha2VfZWNvbm9teQRwb3MDMQRzZWMDeW5fcGFnaW5hdGVfc3VtbWFyeV9saXN0BHNsawNqYXBhbnNjZW50cmE-