The Japanese economy is finally showing signs of recovery after remaining in the doldrums since May 1991, according to media reports. For example, stock prices are rising, corporate performance is improving, exports are expanding and capital spending is growing.
The stock market mirrors conditions in the real economy. On April 28, 2003, the Nikkei average on the Tokyo Stock Exchange closed at a postbubble low of 7,608, down 80 percent from the high of 38,916 at the end of 1989. Last year's plunge was triggered by the collapse on Wall Street after the Iraq war broke out. But there were no signs of impending deterioration in Japan's economy.
The Bush administration, after taking office in 2001, pushed unilateralism to impose U.S. principles on the world. Its willingness to use force to control opposition contrasted with the Clinton administration's promotion of international cooperation and economic stability. Some analysts say the Bush administration derives its strength from the Pentagon and the oil industry, while the Clinton administration was backed by the Treasury Department and the financial industry. This view is credible.