With more than 4m surplus workers, corporate Japan could easily put 2m people on to the street by this time next year, sending the unemployment figure to an unimaginable 7%.

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While speculative attacks against Southeast Asian currencies revealed feet of clay, Hong Kong can point to a chunky budget surplus, rising corporate profits and a growing economy, not to mention formidable exchange-rate defenses.

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The non-financial corporate sector is running a big surplus (ie, it is saving more than it is investing).

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Yet as the recession has bitten deeper into corporate profits, Japanese firms have become keen to shed surplus labour, particularly the sort of middle manager who disappeared from foreign competitors' payrolls some time ago.

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Tadashi Nakamae, an economist, argues that corporate restructuring is transferring wealth from households to companies in Japan, reducing the surplus cash that families have to save and swelling the coffers of businesses.

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