If the underlyinggrowthrate ofproductivecapacity had remainedthe same, this would imply that the economy was operating around 10% below itspotentialoutput.
As I posted in August, companies are operating with considerable slack (their rateofcapacity utilization is a mere 77.5% below the 81% long-term average).
Rather than the tumbling yen being more evidence of economic incompetence, the exchange rate is the mechanism that redistributes demand away from economies that are operating at full capacity towards those in recession.