Whether it reflects an inability of savers to "get at" direct investment is somewhat difficult to say. In essence we have in Japan (& other countries) a mixed banking sector, partially private, partially public. In the Japanese case govt secs are concentrated in the public bank. This implies ceteris paribus that the proportion of corporate debt and other non-govt assets would be higher in Japan than if it had no public bank. To the extent that the big banks have a disproportionately low share of govt secs (and are also highly leveraged vis a vis their western counterparts, having a special exemption from international reserve standards) in their portfolios, they would have a higher proportion of corporate issues (not to mention stocks, since they have no Glass Steagall).
So you would expect the Japanese banking system to be more vulnerable to conditions which affect the value of corporate debt and equity securities.
Which it is.
--gn.
Doug Henwood wrote:
> Dennis R Redmond wrote:
>
> >You betcha. The latest figures from the Nomuri Shimbun say that the
> >Japanese postal savings system now has a grand total of 250 trillion yen
> >in deposits sitting around and accumulating interest (up from 200 trillion
> >as late as 1994). That's a cool $2 trillion in rocksolid liquidity, just
> >itching to be spent on Mitsubishi's latest chip technology.
>
> But it's not being spent on real world technology. I'm a bit mystified,
> Dennis, by how you're so scornful of Anglo-American rentiers, but see the
> accumulation of financial assets as evidence of Japanese economic might.
> Those postal savings balances suggest that the profitability of real-world
> Japanese capital is too low to entice them out of money form and into
> engagement with living labor. Of course everything could change; the U.S.
> bubble could break and Japan could recover from its decade of torpor. But
> right now Japan looks kind of weak, and those stagnant postal savings
> balances are evidence of that.
>
> Doug
-- Gregory P. Nowell Associate Professor Department of Political Science, Milne 100 State University of New York 135 Western Ave. Albany, New York 12222
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