Japan’s Financial Mess

IN DENIAL

Japan's economic performance in the 1990s continues to be disappointing, frustrating, and worrisome. Tokyo's economic sluggishness in the financial sector is souring life at home and setting off international reverberations. Much of Japan's financial weakness is mirrored in other Asian countries. More important, Japan's failure to deal with its economic woes provides a cautionary tale of the resistance to reform that should be expected elsewhere in the region.

Despite government and media portrayals of imminent "big bang" financial reforms, the reality will be far less dramatic. Among bureaucrats and politicians there remains a strong faith in the Japanese