Going Global

International Investing: Japan

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Country Overview: Japan has developed the second most technologically powerful economy in the world after the United States, and the third-largest overall economy, after the U.S. and China.

Japanese economic traditions, such as a guarantee of lifetime employment for a substantial portion of the urban labor force, have gradually eroded.

The industrial sector is heavily dependent on imported raw materials and fuels, and the agricultural sector is highly subsidized and protected. The huge fishing fleet accounts for nearly 15% of the global catch.

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CNBC Global Report: Tokyo

Growth was spectacular in the 1960s (averaging 10%), 1970s (5%), and 1980s (4%), but overinvestment and an asset price bubble in the late 1980s slowed growth in the 1990s below 2%. Japan's huge government debt totals 176% of GDP.

What to Watch: The race is on for the Christmas holidays, and analysts say Sony might be falling behind. For months, analysts have wondered whether Sony can live up to its Walkman legacy.

The PlayStation 3 is the cornerstone of Sony's turnaround, but the gaming unit will still be deeply in the red this year. Analysts say a second holiday let-down could set it back permanently against Nintendo and Microsoft.

Sony's group profits have rebounded under CEO Howard Stringer, but key products like flat panel TVs are up against smaller and younger rivals.

Its balance sheet though has gone through a makeover. The IPO of Sony Financial Holdings is one of Japan's biggest public offerings.

"The prudent usage of the money, particularly of the IPO, is to do a share buyback," says David Gibson, deputy head of research, Macquarie Securities. "In the course of this fiscal year, towards the end, that might end up being perhaps Stringer's swan song."

And a catalyst to push the shares to 9000 yen, Gibson said.

There's been talk that Sony robotic engineers are working at Toyota on next generation cars. The next big Japanese export could be a cross between an Aibo and a Prius.