JAPAN PLANS RECOVERY; COUNTRY SEEKS END TO BAD DEBT.Byline: Todd Zaun Associated Press Associated Press: see news agency. Associated Press (AP) Cooperative news agency, the oldest and largest in the U.S. and long the largest in the world. Under intense pressure after a U.S. rescue of the plunging yen, Japanese leaders scrambled Thursday to explain how they plan to bring the world's second-largest economy out of its deepest recession in 50 years. Prime Minister Ryutaro Hashimoto Ryutaro Hashimoto (橋本龍太郎 Hashimoto Ryūtarō, July 29, 1937 - July 1, 2006) was a Japanese politician who served as the 82nd and 83rd Prime Minister of Japan from January 11, 1996 to July 30, 1998. , in an hourlong hour·long or hour-long adj. Lasting an hour: an hourlong television episode. Adj. 1. nationally televised news conference, said the nation's economic health would improve after the government implements its latest stimulus plan. He also pledged to come up with a strategy for cleaning up the bad loans that have paralyzed par·a·lyze tr.v. par·a·lyzed, par·a·lyz·ing, par·a·lyz·es 1. To affect with paralysis; cause to be paralytic. 2. To make unable to move or act: paralyzed by fear. the nation's banks. Declining financial markets and worries about the viability of Japanese banks have severely discouraged consumers, Hashimoto acknowledged, conceding that his government's decision to raise the nation's sales tax sales tax, levy on the sale of goods or services, generally calculated as a percentage of the selling price, and sometimes called a purchase tax. It is usually collected in the form of an extra charge by the retailer, who remits the tax to the government. last year has dampened domestic demand. ``Japan has fallen into a state of excessive lack of confidence,'' Hashimoto said. ``These are very hard times.'' On that point, there is no disagreement. But as the prime minister made his comments, just hours before the arrival of a delegation of U.S. finance officials, the question was, What is Japan going to do about it? The United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. and other nations are pushing on several fronts: They want Japan to shut the most problematic banks and pump capital into the others so they can begin lending again; they want the government to deregulate deregulate To reduce or eliminate control. One of the major forces in the financial markets in the 1970s and 1980s was the federal government's decision to deregulate interest rates. the economy to make it more open to foreign goods and services In economics, economic output is divided into physical goods and intangible services. Consumption of goods and services is assumed to produce utility (unless the "good" is a "bad"). It is often used when referring to a Goods and Services Tax. ; and they want Japan to create incentives for its citizens, who are legendary savers, to spend their money. Speaking before his arrival in Tokyo, Deputy Treasury Secretary Lawrence Summers Lawrence Henry "Larry" Summers (born November 30, 1954) is an American economist and academic. He is the 1993 recipient of the John Bates Clark Medal for his work in macroeconomics, was Secretary of the Treasury for the last year and a half of the Bill Clinton administration, and , who leads the U.S. delegation, said only that he looked forward to ``discussing a range of economic issues between the United States and Japan.'' The U.S. group was to attend a series of private talks with Japanese leaders, and a broader meeting of international finance officials was set for Saturday. On Wednesday, the United States joined Japan in intervening in currency markets to support the sinking yen. The dollar sales pushed the U.S. currency down more than 5 yen from its previous day's level in Tokyo, a drop of 3.6 percent. In late Tokyo trading Thursday, $1 bought 136.88 yen, compared with 142.00 yen late Wednesday. The dollar's decline took some of the pressure off Asia's troubled economies, whose leaders fear that a prolonged pro·long tr.v. pro·longed, pro·long·ing, pro·longs 1. To lengthen in duration; protract. 2. To lengthen in extent. weakness of the yen could deepen the region's currency crisis. But the problems that first drove the yen lower remained unresolved. In the eight years since Japan's high-growth economy ground to a halt, the troubles in the nation's financial and real estate sectors have only worsened. In meetings scheduled for today and Saturday, Japan is expected to outline its plans for finally cleaning up the $562 billion of bad debt, much of it left over from a real estate boom that went bust in the early 1990s. Hashimoto said repeatedly during his news conference that ``bad debts must be cleared from the banks' balance sheets'' - although he offered no concrete proposals. Politicians from Japan's governing Liberal Democratic Party promised recently to draft legislation to fix the bank mess before an upper house election July 12. CAPTION(S): Photo PHOTO (color) A money dealer rises and sends hand signals at the Tokyo Foreign Exchange on Thursday morning. Tsugufumi Matsumoto/Associated Press |
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