Why Japan-style malaise could happen

[Charles Jannuzi]

>>What's different is that part of the reason
Japan has been unable to come 
off the mat, aside from the aftermath of its
mania, is that the Japanese 
banks have kept businesses alive that should have
gone bust. These are often 
referred to as the zombie companies: "alive, but
nearly moribund."<<

Japan has had record numbers of bankruptcies in
the past 10 years. Corporate bust ups are handled
somewhat differently, with banks and creditors
coming together on more deals outside of court--I
believe anyway. Still, it's misleading to say
that the Japanese banks have just kept zombies
alive. The danger is that the banks are the
zombies, especially now that they have to meet
the 8% capital adequacy ratios. I found the
article rather worthless actually, by the way.
Anyone who knows so little about Japan probably
knows little more about the US other than the
fact that he lives there. 

CJannuzi

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