Saving the Sun: Japan's Financial Crisis and a Wall Streby Gillian Tett
Saving the Sun tells the story of the world's largest private equity deal where American investors made billions of dollars rehabilitating Shinsei, a failed Japanese bank. Within that business saga is the dramatic tale of Japan's brightest financial minds, the men who made the Japanese economic miracle come to life, and their struggle against the economic/em>
Saving the Sun tells the story of the world's largest private equity deal where American investors made billions of dollars rehabilitating Shinsei, a failed Japanese bank. Within that business saga is the dramatic tale of Japan's brightest financial minds, the men who made the Japanese economic miracle come to life, and their struggle against the economic failure in the 1990s. Into this climate of despair, where Japan seemed incapable of reviving prosperity, came a group of wily and determined Americans who would discover just how different the Japanese really are.
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Saving the SunA Wall Street Gamble to Rescue Japan from Its Trillion-Dollar Meltdown
By Gillian Tett
Harper Collins PublishersCopyright © 2003 Gillian Tett All right reserved. ISBN: 006055424X
After the war we had a system that was really a type of socialism under the disguise of capitalism. The bureaucrats directed everything, in a wise way, and we all accepted that and worked together very hard. The system worked well for a few decades.
- Yoshiyuki Fujisawa, former chairman of IBJ
In the evening of June 8, 1999, the Tokyo police telephoned Katsunobu Onogi at his house. "Tomorrow we are going to arrest you," the caller said politely, "please take care to be ready!" Staging the arrest so everything could be done in the proper fashion, the police asked Onogi to suggest a convenient location. Japan is clearly not a country that leaves room for surprises.
Nor was Onogi surprised. As he put down the telephone, part of him felt relieved. He was grateful that the police did not plan to drag him away in a disorderly fashion. At the age of sixty-three, Onogi had spent his entire life behaving with dignity and he had absolutely no intention of going to prison without being properly attired in the suit and tie that was the badge of a Japanese "salaryman." The possibility of such shame appalled him.
Atthe same time, Onogi was terrified, too. Even with the correct clothes - and with all the perfect etiquette - prison was a frightening place. Onogi had always been an intellectual and methodical man. He wore large, bookish glasses and an impassive expression on his square face, broken only by a tense half smile that turned down at the corners of his mouth. Whenever he faced a problem, he liked to scour history books for answers and in the weeks leading up to his arrest, Onogi had furtively peeked into bookstores to see if there was any guide to what a middle-aged man should do in prison.
Alas, there was no way to bone up on the ordeal ahead. Nor had Onogi's professional career given him any idea of what to expect in jail. Onogi could scarcely have imagined that he would share the fate of a common criminal. He had spent his whole life believing that he was a member of the elite, a respectable man who did things right, according to Japanese ideas of duty. He had slaved for forty years of his life in Long Term Credit Bank, one of Japan's most prestigious banks, where he had risen to become president. Normally, such service would have guaranteed Onogi a comfortable retirement. Holidays in Hawaii; rounds of golf; group trips with former colleagues to Japan's hot springs; the satisfaction of knowing that he had served his country well. That was how most sixty-three-year-old Japanese bankers lived.
But somehow it had gone horribly wrong for Onogi. LTCB had collapsed with almost $50 billion of bad loans, engulfing Onogi and his employees all in a shame that was too much for some of the most senior LTCB bankers to bear. A few weeks earlier, fifty-nine-year-old Takashi Uehara - the man who was expected to succeed Onogi as LTCB president - also received a telephone call from the police warning that his arrest was imminent: Uehara and the other LTCB managers were accused of hiding the bank's bad loans. Uehara decided to commit suicide. Once the Japanese believed that the correct way to kill oneself was to slash the stomach open with four precise strokes of a sword, letting the guts spill out, a method known as seppuku. Nowadays, that was deemed "selfish," since it created a bloody mess that needed to be cleaned up. Consequently, when executives committed suicide in the 1990s, they usually hung themselves in an anonymous hotel - to spare their family "shock." Uehara had always been a stickler for etiquette: He checked himself into a little suburban hotel and hanged himself, leaving a note on the table for Onogi and the other LTCB bankers. It said: "I am so sorry."
Onogi, however, did not want to kill himself. He considered it his duty to suffer his shame alive - to "endure the unendurable," as the Japanese emperor had described the American conquest after World War II. So, he fixed his mind on cheerful things. He reflected on an Italian film he had just seen on television about a concentration camp in World War II, called Life Is Beautiful. Onogi liked the title. "Life is beautiful!" he told himself. "Life is beautiful."
He also resorted to his favorite mental survival trick: He imagined that he was looking down at himself from far outside his own body, as if he were an academic writing one of the sweeping pieces of history that he loved to read. Onogi had always found that trick comforting. It seemed to put life into perspective; to give a broader dimension to his own, little fate; to give a meaning to the terrible events that had engulfed LTCB. It was, he sometimes admitted with a dry chuckle, a very strange tale - not just for him, but for Japan.
And it seemed to be getting stranger, with every year that passed.
For Onogi, the LTCB story had started almost exactly four decades earlier, on April 1, 1959, a time when the pink cherry blossoms were blooming in Tokyo. On that day he turned up at the bank, as a fresh young graduate for his first day at work. "Onogi Katsunobu here!" he declared to an official, with a bow, using his surname first in the Japanese manner. He was wearing a suit and tie back then as well. But it was an ill-fitting, cheap, dark blue outfit, identical to the suits that all the other new graduate trainees wore. Fourteen years earlier Japan's economy had been smashed to pieces in World War II. So the bank had assumed that the new trainees would be too poor to afford to buy their own suits, since these cost Y30,000 ($84) each, or three months' average wages, so they doled out matching outfits to the graduates for free ...
Excerpted from Saving the Sun by Gillian Tett
Copyright © 2003 by Gillian Tett
Excerpted by permission. All rights reserved. No part of this excerpt may be reproduced or reprinted without permission in writing from the publisher.
Meet the Author
Gillian Tett was trained as a social anthropologist but became a journalist while doing fieldwork in Soviet Central Asia during the of communism in Russia. Since that time she has risen through the ranks of the Financial Times, holding positions on its economics desk before becoming the bureau chief in Japan. She now lives in London.
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