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Strategies & Market Trends : Asia Forum -- Ignore unavailable to you. Want to Upgrade?

To: MikeM54321 who wrote (4159)	6/3/1998 8:54:00 PM
From: Joseph Beltran	Read Replies (1) \| Respond to of 9980

I haven't thought this through yet but it seems to me that u.s. companies have a substantial competitive advantage vis a vis their s.k. and japanese counterparts in terms of borrowing ability. There must be ways in which u.s. companies can use that advantage to capture market share in this environment....for example, what if u.s. chips companies, for example, used their borrowing ability en masse to finance capital equipment purchases which will give them a substantial production cost edge? it just seems like there may be quite a few opportunities for u.s. companies in this environment but I can't quite diagnose the possibilities. regards

To: MikeM54321 who wrote (4159)	6/3/1998 10:33:00 PM
From: Mark Myword	Read Replies (1) \| Respond to of 9980

Mike : re: Business Week , 11 Trillion US$!<< I copied the article , but don't have the SI printout. It's the 5/18 issue of BW. The figures according to them are - actual public debt $11 trillion , and actual problem loans $1 trillion. Personally , I suspect the problem loans are considerably higher , but it's all in how you define "problem" . Many Japanese companies large and small are very highly leveraged , and the banks used to lend money to anybody who breathed. They define a problem loan as not even paying interest - in other words , no hope of collection. Think about it - a lot of companies can scrape together interest , which usually isn't too much of a problem. If a loan is simply paying interest , it's not a "problem" loan ! This is regardless of whether there is any realistic chance of the PRINCIPAL ever being repaid. No telling how big this number is , but it is likely huge. The BW article is stating the government's "official" figure , and adding in a few extras , but still under the definition of "paying interest, no problem".