Did Japan Fail Because Of No Bailout?

Nicholas D. Kristof writes in the New York Times today that America should bail out the Wall street fat cats or face an moribund economy and stock market. He uses the Japanese meltdown of the 1990s as a lesson.

Japanese politicians, acting with the same sublime ineptitude that our own House
of Representatives displayed this week, ignored a growing banking crisis and
dithered on a bailout. And so I watched from Tokyo as a mighty economy melted
like an iceberg in the Caribbean.

He then goes on about how Japanese businessmen were lost in greed, and how this was the reason the Japanese public didn't have the stomach to bail them out. No word of the underlying cause of Japan's relative meltdown of course. No word on the fact that Japanese interest rates had been artificially lowered by the BOJ for years causing an unsustainable boom. No explanation that the banks and large Japanese businesses were intertwined with government to such a degree that corruption and mangled incentives rotted the very core of the Japanese economy--in much the same we they are in the United States.

But, for now, the priority is to get credit flowing again in the arteries of
commerce, even if that means saving the jerks. Otherwise, we risk becoming
Japan.

Good grief, get this man a subscription to the Mises Institute Daily Articles!

He continues with some fairly good cautionary information midway though his terribly silly article however:

For those of you accustomed to bull markets, who think we’re sure to come
out of this quickly, remember this: Japan’s main stock index is still less than
one-third of its level of 19 years ago.

This is good to know as it seems many do not understand the gravity of what the United States faces. Many still seem to be working under the notion that this is merely a rocky time for the stock markets, and normal upward trajectories will continue after this little spell. Bullshit.

This correction is the culmination of numerous structural problems in the global economy, and there is no sign yet that the G8 governments will allow the correction to happen in an orderly--market centered fashion. Get out. This isn't a buying opportunity, it's a bloodbath.