Why American banks will not wind up looking like Japanese banks - Part 1

I have to welcome a few readers from Talking Points Memo. They are reproducing my posts at least to the extent that they go to explaining banks and the financial crisis to a policy/politics driven audience. Given the purpose of the Bronte Capital blog is primarily to explore investment ideas the policy/politics wonks at TPM might find my posts a little odd. [My purpose is largely to make lots of money.] Nonetheless I do have things to say which I think are important from both an investment and a policy/politics perspective. To this end I want to explain why I do not think the American banking system will wind up looking like the Japanese banking system at the end of this crisis – and what the implications of that are both in a policy and an investment sense.