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Yomiuri on reforms to finance laws

An opinion/analysis piece in today’s Yomirui started like this:

Financial institutions in Japan have lost a great deal of international competitiveness during their struggle to resolve a host of problems arising from the collapse of the bubble economy, including their massive nonperforming loans. They have also suffered a significant decline in their standing in the global financial market. Swift measures should be taken to revive their international competitiveness.

This is certainly true, though the paper has seemingly been writing editorials that open with this paragraph for some years now. The next, paragraph, however, seems somehow relevant yet entirely disconnected to what was laid out in the opening:

The government has submitted to the Diet a bill aimed at revising the Financial Instruments and Exchange Law. A central pillar of the bill is to reform the current system so as to expand the list of financial products traded in the market, while also increasing the number of market players and attracting more funds from domestic and foreign investors.

This would be a positive step, though one is forced to wonder what it has to do with reforming a corporate culture that allows nonperforming loans to build nearly to the breaking point. The Nikkei recently published an article concerning the sale of about 100 billion yen worth of bad loans to the Goodwill Group that Mizuho has now sold to Morgan Stanley and the Cerberus Group (the good news is that Goodwill Chairman Masahiro “Juliana Tokyo” Origuchi is expected to resign).

At any rate, the Yomiuri article gets better as it goes on to describe what’s included in the reform bill:

Specific measures include a plan to establish a market in which foreign and start-up companies would be able to have themselves listed through simple information disclosure.

Simple information disclosure? So, will it sort of be like a hybrid of EDINET and Shinginko Tokyo? Sweet…

And then:

Another pillar of the bill is to relax regulations on the scope of services provided by financial institutions. The plan is aimed at making it easier for banks to undertake new business operations, thus shoring up their international competitiveness.

Relaxed regulations? Are they going to let people fill in their own income and employment information before not checking it to give them a mortgage?

That would certainly bring things up to the level of international competitiveness…

The goal of all this? Of course:

Japan needs to take full advantage of financial assets held by its citizens–worth 1.5 quadrillion yen–and investment money from oil producers and other foreign countries. This will be essential in keeping Japan’s economy vibrant despite its declining population.

If by vibrant they mean, “Really exciting when people’s money gets lost.”

Although the Yomiuri acknowledges that there may be some risks involved for individuals, everything will be just peachy so long as everyone behaves:

Easing regulations on financial products trading is certain to benefit financial institutions, granting them greater freedom of action. As a result, financial institutions should exercise greater self-discipline in their conduct of business.

Self-discipline? That is going to be one long, boring corporate seminar.

</sarcasm>

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