In Tokyo, even the most fierce dragon is afraid of the hatchet

"What Koizumi said makes sense. If this nation is allowed to become a country that naturally perishes because of its birth rate, it will simply be the greatest shame for the Yamato nation."

"Please don't forget the oath you made when you passed the civil service exam."

"If we can't allow the situation to continue at this point, what will this country look like in 20 or 30 years?"

Ryutaro Hashimoto was almost angry to death.

Don't you know where your fucking butt is?

I never expected that this bastard Haibu would suddenly turn against us.

Ryutaro Hashimoto showed a righteous face: "Although that is what I said, if the housing prices are too low, it will not be conducive to the struggle of young people!"

"Don't you think that's shameful, Hashimoto-kun? I've never seen such a shameless guy!"

Koizumi Haruichiro immediately retorted, pouting and looking disgusted.

If it weren't for his messy hairstyle, this Minister of Health and Welfare would look more like an upright minister!

However, Hashimoto Ryutaro was no pushover and immediately retorted: "Compared to the guy who bows to a woman, Hashimoto seems to be a little bit worse! A real man actually needs a woman as a helper, it's really a man's glory!"

"Who are you talking about, Hashimoto?" Tanaka Makiko yelled immediately.

Kaifu Shunsuke was overwhelmed. He had experienced the ability of this woman Tanaka to quarrel with others, so he quickly stepped out to be a peacemaker: "Please be quiet, everyone! What Hashimoto said does make sense. If the housing prices are too low, it is indeed not conducive to the struggle of young people."

Koizumi Haruichiro stood up and said, "Your Excellency, this is too much! Isn't the future survival of the Yamato nation more critical when it comes to struggle and fertility? Statistics on the enrollment rate and marriage rate of the Ministry of Health, Labor and Welfare show that the situation is obviously getting worse because of the high debt rate and economic pressure among young people."

"This...economic issues, Koizumi-kun is probably not good at it! If there is no goal to work hard for, young people will only become lazier and their productivity will decrease. In this case, if it is really due to the impact of economic problems, low-income groups can just drive private cars and run taxis."

These words left Koizumi speechless.

Because according to the current income level, anyone can easily buy a car, and even if there are difficulties, it is easy to get a loan.

He also knew the price of taxis.

It's not difficult to earn 500,000 or 600,000 yuan a month by just working part-time.

I don't know how to refute this. From a biological point of view, the absence of stress will indeed lead to lower demand and declining productivity.

at this time.

The Secretary-General of the Ministry of Finance came over in a panic.

I lowered my head and said a few words in Hashimoto Ryutaro's ear, and saw Hashimoto Ryutaro's face change drastically.

"What happened?"

“BCCI is bankrupt!”

"Nani?"

Chapter 390 The Sorrow of Being Soft

BCCI's bankruptcy filing.

The entire Ministry of Finance, Banking Bureau and the Bank of Japan were all surprised.

Because as early as May last year, the Bank of Japan carried out large-scale institutional reforms, an important part of which was the establishment of the Credit Institutions Bureau.

Tadayo Homma is the director-general. The agency is divided into a Credit Institutions Division and a Payment and Settlement Division. The former is responsible for financial regulatory supervision and macro-prudential policies, while the latter is responsible for formulating relevant policies for the payment and clearing system.

At that time, stock prices peaked and then began to fall, land prices continued to rise, and the economy was still in a bubble expansion stage.

President Yasushi Mieno had already instructed in the conference room to formulate a response strategy for the Bank of Japan to prevent possible bankruptcy crises of financial institutions.

Subsequently, with the Credit Institutions Bureau as the core, repeated discussions were held on the possible bankruptcy of financial institutions.

Initially, the focus was only on a few institutions that were considered problematic and were listed on the "key supervision list", such as Toho Mutual Bank, Osaka Prefectural Credit Union, Kamaishi Credit Union, and other relatively small financial institutions that provided loans to small and medium-sized enterprises or micro-enterprises.

However, due to the problems of Sagara Mutual Financial Kizu United Credit Union, the target was expanded to include slightly larger financial institutions represented by Hyogo Bank and Pacific Bank.

But BCCI is not on the key supervision list or the risk list.

“Before this, was there any notice of the debt problems of BCCI?”

"No. But according to the published prosperity benchmark date, the peak of economic prosperity occurred in February of this year, between the peak of stock prices and the peak of land prices. The real GDP growth rate has dropped sharply from 2% in 1990 to 5.1%. It seems that the total quantity control directive has had too great an impact."

The so-called total quantity control means that the growth rate of loans provided by financial institutions to the real estate industry shall not exceed the growth rate of total loans, and at the same time, it requires regular reporting on the execution of loans to the "three industries" of real estate, construction and non-bank financial institutions.

This instruction was issued by the Banking Bureau in March 1990 and approved by Ryutaro Hashimoto himself.

The purpose at that time was to deleverage and eliminate market bubbles, which would make the economy healthier and prevent unexpected accidents in Eastern Europe. However, the stock market received immediate feedback, but land prices did not.

This also gave the Bank of Japan a reason to raise interest rates. Mieno Yasushi even used the righteousness to force the Bank of Japan to stop commercial housing loans through window guidance.

There is no doubt that the issuance of the total quantity control directive was undoubtedly the fuse for the sharp drop in land prices.

However, the Bank of Japan's heavy volume increase was like the stone that broke the camel's back, making things worse and worse.

Sanchong, that old bastard.

Clearly realized that he had been cheated.

Because total quantity control will never make things so bad, but the Bank of Japan directly and explicitly prohibits the proportion of real estate and real estate loans, and 70% is too serious.

Just like a joint stock company.

Liquidity is like blood, maintaining the lifeblood of a company. Given the huge size of the real estate industry, the limit on real estate loans was suddenly raised from 30% to 70%.

The result would be like a river with a dam built on it, damaging the downstream ecosystem and inevitably leading to destruction.

Ryutaro Hashimoto cursed inwardly.

But he knew in his heart that even if it happened again, he would still have to make the same choice under the circumstances.

After the meeting.

This Kendo Minister of Finance rarely lit a cigarette.

I was wondering before why this guy Haibu suddenly turned against us, but now I understand a little bit.

According to the rules of Japanese politics, if one fails to fulfill his duties, he must step down. However, if he leaves at an excellent time, stepping down may be a form of dormancy, during which he can wait for an opportunity to make a comeback.

That's the situation.

It is no longer possible for him to challenge the position of Prime Minister.

Even this guy Kaibu is playing badly.

When all the problems break out, no one can do anything!

Next.

That is, a financial credit bureau intervened in the bankruptcy liquidation of BCCI.

According to the procedures, there are three departments that are responsible for handling the bankruptcy of financial institutions, mainly the Banking Bureau of the Ministry of Finance, plus the Bank of Japan and the Deposit Insurance Corporation.

The law stipulates that the chairman of the Deposit Insurance Corporation shall be a deputy governor of the Bank of Japan, so Deputy Governor Hiroshi Yoshimoto also serves as the chairman of the Deposit Insurance Corporation.

In addition, each major life insurance institution and large urban bank also has a vice president serving as a member of the research group. Among them, Japan Life Insurance, as the largest insurance company, also has a vice president in charge of insurance control.

But not long ago, there was a major reshuffle at Bioho, and the vice president who held this position was hospitalized due to a sudden heart attack. The assistant to this position became the president of the Kansai headquarters, Naoyo Nagano.

morning.

Bank of Japan headquarters building.

The Deposit Insurance Corporation Affairs Bureau is located on the third floor here.

There are only a dozen full-time staff members, and most of the others are seconded personnel or OBs from the Bank of Japan, as well as members of a department at the Economic Research Institute.

This is a bankruptcy liquidation agency for a group of financial institutions.

Ok!

If you have to say it.

In fact, it is a joint allocation organization established by major financial groups and government agencies on the resource supply side.

The leaders were Tadayo Homma and Hiroshi Yoshimoto. When the issue of BCCI's bankruptcy and liquidation was mentioned, the people from the Banking Bureau of the Ministry of Finance and the Bank of Japan looked very unhappy.

The so-called BCCI, its full name is Bank of Credit and Commerce International - Tokyo Branch.

Headquartered in Luxembourg, its business scope covers the whole world.

However, since branches of foreign banks in Japan are not subject to Japan's deposit insurance system, the bankruptcy liquidation of the institution was carried out outside the deposit insurance system.

So the major financial groups immediately gave up.

Honma asked for the research group's opinion.

Nakamura glanced at his nephew and said, "With the increase in real estate-related loans and the outrageous rise in land prices, land prices will definitely fall sooner or later. The same is true for BCCI's debt problem to a large extent, so my suggestion is to package these debts and liquidate them immediately, and repay the related debts of other institutions first to avoid involving more institutions."

Nagano took over the conversation: "Seriously, the housing price crash is largely the result of the decline in economic growth after the bubble burst. It was the discounted value of the tax benefits during the bubble economy that pushed up real estate prices. The crash also reflects the end of the tax benefits. So why not just separate BCCI's liabilities from the payment and settlement system?"

You make it sound so damn easy.

What about the depositors?

We all know that Japanese Sheng Bao is a bastard, and now another bastard pops up, not only not helping, but also secretly mocking.

Honma Tadayo was very angry, but he could only say with a dark face: "Nagano-kun's suggestion is worth considering, but in terms of funding..."

Let us pay?

no way!

“Isn’t it natural for the central bank to act as a lending bank of last resort and provide funds when necessary?”

"That being said, Nagano-kun, have you not noticed the criticism from the public? The public is wary of the moral hazard that may arise from the Bank of Japan's involvement in the bankruptcy of financial institutions. So..."

In the "lender of last resort" theory in economics textbooks, the function of the central bank is purely to provide liquidity rather than credit funds.

So.

The public is very disgusted with the central bank's involvement in the bankruptcy of financial institutions.

Because any actions outside the rules are equivalent to the central bank paying for the actions of financial institutions that lead to bankruptcy.

But where the money comes from is a hotly debated issue.

First of all, it needs to be explained that the central bank and government agencies do not produce or create value, so the money to aid bankrupt institutions cannot come out of thin air.

Under the logic of general equivalents, this money will eventually become the bill that everyone pays for the bankruptcy of financial institutions.

The problem is that the bankruptcy of financial institutions often involves corruption and moral issues. Once the central bank intervenes in such bankruptcy liquidation, it means using the flesh and blood of ordinary people to satisfy unlimited needs, thereby fueling the exploitative and corrupt behavior of financial institutions.