[...]... Accord with the United States in 1985, to increase substantially the value of the yen (which doubled by 1988) Fearing the effects of the run-up on Japanese exports, the Japanese Ministry of Finance ordered the Bank of Japan to open the monetary floodgates while the ministry injected massive amounts of fresh spending into the economy via a series of fiscal packages and the expanded investment of postal... loans they offered were characterized by four factors: 1) if they were government-backed or not, 2) the amount and term, 3) the type of property that secured the loan, and 4) if the borrower would be residing in the property or not The credit-worthiness of the borrower was not factored into the equation, as the decision to approve or reject a loan depended solely upon whether the borrower met the underwriting... skirts, they were nearly rabid with excitement due to the imminent arrival of the Norwegian electro-popsters a-ha, who were scheduled to begin their Japanese tour at the Sun Palace in Fukuoka four days later Their high-pitched, high-speed chatter that filled the terminal was all but incomprehensible to the executives from the great keiretsu who were returning home from business trips to Europe and the. .. Casablancas Then, too, there was a seemingly endless supply of less exceptionally beautiful girls of the pretty, fresh-faced sort that one used to see in Sears catalogs and Target newspaper ads And then, there were the Disneyland dancers, the singers, the Snow Whites, and the Cinderellas As the novelist Arturo Perez-Reverte once wrote of a sixteenth-century Spanish church, the presence of so many ladies,... investors to tap into the cash flow being paid by the homeowners to the banks on their mortgaged homes Securitization is the process by which a number of loans are combined into a loan pool, then divided into bonds which are sold off to investors The bonds are secured by the ownership of the underlying property; if the homeowner stops making the payments, thus ending the flow of money, the security holder... justification for the Nikkei’s incredible average P/E multiple of 7810–more than twice as high as the 32.6 multiple of the 1929 Dow – a faith which in the end turned out to have no more substance than the seventeenth-century Dutch belief in the inherent value of tulip bulbs “Between 1986 and 1990, Japan experienced one of the great bubble economies in history It began after the Japanese agreed, in the so-called... to the Western tourists who were disgorged from the murmuring quiet of their 747s into the midst of what appeared to be a cross between a swarming teenage hive and an anime clone army Fifty-three miles away from Narita, in the middle of Roppongi, there was a bar with the name SUNTORY spelled out in large orange letters across the front window glass About thirty feet to the left of the entrance to the. .. advantage of the opportunity presented by risk-based pricing, as a disproportionate percentage of the loans they offered were the higher-priced, higher risk variety Despite providing only 27.8 percent of the total home loans provided in 2004, the independents were responsible for more than half of all higher-priced loans Securitization and risk-based credit pricing were an unmentioned, but nevertheless... will occur, but rather, the full extent of the economic contraction and how long it will take for the economy to return to its pre-contraction levels of wealth and employment once it is finally recognized to be taking place In the historical case of America’s Great Depression, it was 1941 before the economy again reached its nominal 1929 GDP; it was not until 1954 that the stock market returned to its... Japanese market capital from 197 4-1 995 and owned 39 percent of the total number of corporations, were each based around a major bank The table below shows their pre-1990 structure as well as the global ranking of the keiretsu’s central bank12 and two of the group’s most recognizable corporate affiliates Table 1.2 The Major Japanese Corporate Groups circa 1990 By 1990, seventeen of the world’s forty largest . the Ricardian Vice 6 The Whore, the False Prophet, and the Beast from the Sea 7 An Answer in the Alps 8 A Keynesian Critique of Austrian Theory 9 The Return of the Great Depression 10 Great Depression. then, there were the Disneyland dancers, the singers, the Snow Whites, and the Cinderellas. As the novelist Arturo Perez-Reverte once wrote of a sixteenth-century Spanish church, the presence of. increase the value of their estates.” All economics ultimately rests on the basis of a single question: What is value? The great challenge of economics, as well as the ultimate source of its tremendous complexity,