[spicytuna]

I know at least 10 people at IBM (Japan) who were laid off during the last few months.

Unfortunately, I don't think Japan has seen the worst of it yet. The layoffs are just beginning to happen as Nissan, Panasonic, NEC and Hitachi just announced a combined total of 60,000 job cuts... so far. Of course this number is worldwide but it doesn't take away from the fact that the increasing unemployment rate is already at a 40 year high.

People who are unemployed cut down on spending which in turn hurts the retailer which in turn eliminates more (retail) jobs. It's a downward spiral which is just starting to gain momentum.

One thing the Japanese have going for them is the fact that they're a lot better with personal finances than the Americans who love using credit. It'll help soften the blow but ultimately, the US economy will have to recover before Japan has any chance of recovery.