Tuesday, February 12, 2008
Japan maybe hiding $300bn debt
There is still $300bn of bad debt out there, and Japan could be hiding most of it. Ambrose Evans-Pritchard reports
Just as battered investors had begun to glimpse signs of recovery in America, the next shoe has dropped with an almighty thud in Japan. Echoes are rumbling across the Far East.
OK - You want to know how one can hide $300bn? here's the article.
The Tokyo bourse has crumbled, suffering the worst start to the year since the Second World War. The Nikkei index is down 17 per cent since Christmas, and the shares of Japanese banks are leading the slide.
Americans and Europeans have so far confessed to $130bn of the estimated $400bn to $500bn of wealth that has vanished into the sub-prime hole. Somebody, somewhere, must be sitting on a vast nexus of undisclosed losses. We may find out soon enough whether the hold-outs are in Japan. The banks have to come clean under the country's strict new audit codes by the end of the tax year in March.
If you don't know why this is so important check out the Yen carry Trade.
Although, when put into perspective Warren Buffet seems to be a rich man. He's helping out the US $800bn. That's a lot of wealth folks, and we wonder why we have financial problems.