"This cycle has been different to those that preceded it. Notably, it broke the clear rule of post-war cycles: the deeper the downturn, the sharper the recovery. This time the deepest post-war recession was followed by one of the weakest post-war recoveries. Moreover, that lackluster rebound came despite unprecedented policy support: zero official rates, unconventional monetary policy, the largest budget deficits seen in peacetime and the spillover benefit from the V-shaped recovery in the emerging economies."

(...)

"This suggests that the vanilla cycles of the post-war period will not provide much guide on how this cycle will unfold. The comparable cycles – comparable in severity and causality – are rare. However, Japan continues to offer some lessons, in my view."

Downunder Daily

So Far, This Time Is Different

Morgan Stanley Research Asia/pacific

June 10, 2011