capital-injections-needed-to-save-us-banks

Capital injections needed to save US banks

Richard Koo, chief economist at the Nomura Research Institute in Tokyo, discusses the grim parallels between the US and Japan, including the need for unconditional capital injections.
Do you see any parallels between the US now, and Japan in the 1990s
ItÆs looking like a replay of many of the events that happened in Japan. Take the example a few weeks ago, during the G-7 meeting in Tokyo, when the Japanese finance minister advised the US treasury secretary to carry out immediate capital injections to the US banks. Paulson couldnÆt commit himself û similar to Japan in the 1990s, when public opinion was very strongly against bailing out highly-paid bankers and irresponsible banks. Recall also that in 1992, then-Prime Minister Miyazawa wanted to help the banking system with public funds, but was slammed by the public. As a result, it became taboo...
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