Both the global economy and Japan’s economy currently face mounting challenges. Looking back, it has already been six years since U.S. housing prices peaked, five years since the subprime mortgage problem surfaced in the form of what has come to be known as the Paribas shock, and about four years since the Lehman shock.
Thanks to aggressive policy implementation by authorities and other measures following the Lehman shock, the global economy succeeded in avoiding a downturn as significant as the Great Depression in the 1930s. Nevertheless, the pace of recovery in advanced economies thereafter has remained very sluggish, unlike anything they have experienced since World War II.