“These lead to tighter credit conditions and falling stock prices as their collateral assets are liquidated. In this case, two of the failures are insurance companies, whose assets are entirely financial securities.”
“Rising energy prices will further subtract from already-falling real income growth in Japan. In our view, a one or two percentage point subtraction from the growth rate of consumer demand at the margin will prove catastrophic to all hopes of substantial economic expansion.”
“The catastrophic destruction of wealth than began in January 1990 has left assets ? equities and real estate, mainly ? deflated against a mass of liabilities that are mainly bank loans.”
“We do not see any fundamentals strong enough to keep it up there --unless there is a lot of intervention with other governments joining in. We expect the move will fail.”
