Comrade Jannuzi
You write: "Are you a business major at an American university? I mean, you seem like it."
No, I'm an unemployed socialist (the bottom really fell out of the market for socialists in the late 80's). I'm cautious, therefore, about the Japan-as-socialist-nirvana argument made popular by our own Comrade Redmond and others. I see Japan as a thoroughly bourgeois state that only seems otherwise because it has a high level of social cohesiveness. It's not that social cohesiveness is anything to sneeze at, I just don't think it's a durable as a legal system that anticipates and copes with conflict. I think Japan is far behind the US in the process towards completing the capitalist revolution.
I'm a bit fascinated by asset securitization because I think it represents what might be the last stage of the capitalist revolution. Whether or not that's true, I don't se any particular advantage to the Japanese working class in keeping these assets in the hands of the bank managers that made the bad loans in the first place. After all, who is to blame for the fact that these portions of Japanese loan portfolios are worth ten cents on the dollar? If they're worth more, why don't the Japanese banks sell them for more? There is a large international market for securitized assets, after all.
Moreover, I think you misunderstand the effect of loan securitization. American banks, such as JPM, absolutely live to securitize and syndicate their loan portfolios because it spreads risk, frees reserves for further lending, and trades uncertain interest income for definite service and underwriting income. There's no harm to Japanese banks in securitizing their loan portfolios unless they sell them for too little and I'm not sure what your evidence is that they will be forced to sell them to particular buyers for too little. Billions of dollars in asset-backed securities are bought and sold every day by all sorts of institutional money managers.
Finally, I'm not sure how stocks enter into this picture. Aren't we talking about loan-backed securities here? How are we "lending money to GE or Tyco and waiting for the price of the stock to go up again" ?
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