Accurate Assessment of Economic Impact of Japan's Earthquake, Tsunami, and Nuclear Woes Offered - Exploration of Data That Investors Are Not Getting

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Investors jumping to conclusions about Japan without all the facts - Media focusing on the most terrifying images and stories, painting a misleading picture.

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The addition of water damage and a serious threat of radiation leaks raises the level of the challenge, but Japan has a culture and mentality that facilitates rebounds and recovery.

Investors watching only the mainstream media's coverage of Japan's post-earthquake and post-tsunami activity are not getting an accurate picture of the country's remaining industrial capacity. James Brumley, chief analyst of the Rhino Report, has offered perspective and additional data to subscribers that suggest hysterical reactions and worry are largely unmerited.

While the images and films of last week's tsunami in Japan are horrifying, only a small portion of country was affected by the rushing water. Moreover, though the flooding did impact an industrial center as well as the Fukushima nuclear power plant, this northeast region of the country only contributes about 4% of the nation's annual GDP. The majority of Japan's manufacturing capacity is still intact, with much of it not being affected at all by the earthquake or the tsunami.

Brumley writes "Toyota and Honda will be reopening several plants over the next few days, but Texas Instruments' technology manufacturing facility there won't be fully restored until July. 'Weeks to months' seems to be the typical description of the likely delay in resuming operations for those adversely impacted, but most facilities have already restarted operations."

Japan has also proven to be resilient when it comes to surviving and reversing natural disasters. The January, 1995 earthquake centered near Kobe - another of Japan's major industrial centers - tore that city and its factories apart then. But, after industrial activity fell 2.6% that month, it rose 2.2% in February, and was up 1.0% in March, just two months later. The GDP growth rate for the first quarter of 1995 in Japan still came in at 3.4%. In fact, Japan's economy grew by 1.9% in 1995, and then 2.6% the next year.

"Granted, the addition of water damage and a serious threat of radiation leaks raises the level of the challenge, but Japan has a culture and mentality that facilitates rebounds and recovery", Brunley comments.

As for the concerns that radiation could leak out of a damaged reactor, it's not an illegitimate worry. Still, the media has focused on the worst-case scenario, without looking as closely at the most-likely scenario. Odds are that the leak will be contained, one way or another, before it reaches dangerous levels.

Brumley adds, "On a side note, the failure of the safety measures at the Fukushima nuclear power plant have prompted discussions that this accident could spell the end of nuclear power itself, as the dangers are highlighted. An ideal world would be a non-nuclear world to be sure, but with seventeen such facilities in Japan alone, and more than 400 nuclear power plants worldwide supplying 15% of our energy, nuclear isn't going away anytime soon. All sixteen of Japan's other nuclear plants are still safe. The problem with the Fukushima plant isn't nuclear power itself, but an antiquated plant built in the 1970's near the coastline. It's very much an anomaly relative to today's nuclear power standards."

The Rhino Report's chief analyst does expect the broad market to sink further, but the disaster in Japan is only the catalyst that put the selling into motion. The market was overbought already, and ripe for such a dip.

Please visit the Rhino Report web site located at: for more information.

About The Rhino Report

The Rhino Report is a complete solution providing investors and traders with disciplined short-term and long-term market calls, as well as specific stock recommendations from a proven proprietary system that incorporates both fundamental and technical analysis. Its reliable and timely investment newsletters are delivered during trading hours, allowing investors and traders the necessary time to act before anyone else.

Members receive in-depth sector analysis to help them identify current hot spots in the market and comprehensive economic analysis to determine forward-looking market trends and sentiment. The Rhino Report also provides its Member with password protected access to an exclusive Member Login area to view specific stock recommendations, portfolio performance, report archives and much more.

The Rhino Report provides a whole look at the equity markets and explains in detail how one can generate maximum returns with minimal risk exposure. Investors are encouraged to visit The Rhino Report at: for more information on its advisory services and how to become a Member.

James Brumley
The Rhino Report
Email: editor(at)rhinoreport(dot)com

Source: The Rhino Report


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