In Cash-Rich Japan, World’s Financial Woes Inspire a Grand Plan –

Kotaro Tamura, an investment banker turned Japanese lawmaker, has an immodest proposal for healing the sick global economy, making all Japanese richer and compelling the United States to be more deferential toward Japan.

“We are in a special position because we have huge money,” Tamura said, referring to about $950 billion in government foreign reserves, $1.5 trillion in public pension funds and $15 trillion in personal financial assets, about $8 trillion of which is on deposit at shockingly low interest rates in Japanese banks.

“We should send the signal that we are ready to save the world with this money,” he said in an interview.

Tamura leads a group of 65 lawmakers from the ruling Liberal Democratic Party who have proposed to Prime Minister Taro Aso that Japan treat the global financial meltdown “as a huge opportunity for us.”

They are urging the government to inject some of its abundant cash into troubled U.S. and European banks, in return for equity, and to purchase distressed corporate assets at fire-sale prices.

“The economy of every major power has crashed, and Japan has the least tainted market in the world,” Tamura said.

“Everything is very cheap right now [in world stock markets], and 10 years from now we would make very big money,” he said

Finally, Tamura said, Japan could gain much more than mere money by coming to the aid of the United States and its many distressed companies. “If we can save the United States economy, then the U.S. government will owe us in other ways,” he said.

A U.S. move that has offended many Japanese is the Bush administration’s decision last weekend to take North Korea off its list of states that sponsor terrorism.

The Japanese public vehemently opposes the delisting because North Korea has refused to provide satisfactory information about the fate of eight Japanese citizens who were abducted by North Korean agents during the 1970s and ’80s.

“If we make the proper moves with our money, we can gain diplomatic fruit,” Tamura said. “We can insist that the United States put more pressure on North Korea. As I said, this is a huge opportunity for us.”

via In Cash-Rich Japan, World’s Financial Woes Inspire a Grand Plan –


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