Japan's economy in free fall

Doug Henwood dhenwood at panix.com
Fri Sep 18 08:22:46 PDT 1998

Mark Jones wrote:

>Doesn't it strike you as just a trifle apcoalyptic, unprcedented anyway,
>for a paper like the FT to recommend nationalising the Japanese banking

Why? The U.S. effectively nationalized Continental Illinois in the mid-80s and Citibank in the late 80s, and took on $200 billion in bad S&L debts. Mexico nationalized its banks in the early 80s, Pinochet nationalized lots of bum Chilean debt, and lots of Latin American private sector debt became public sector debt during the 80s debt crisis. The Scandinavian countries socialized lots of bad bank debt in the late 80s/early 90 It's a well-established crisis management tecnique, of a sort that all you catastrophists are convinced doesn't work. In a hedging formula designed to annoy Lou, I'll say again maybe it won't work this time, maybe the crisis tendencies can't be displaced or deferred; maybe it is the day of reckoning. But then again, maybe not.


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