Yakuza to the rescue! +

I know Americans as a whole can be a bit sheltered as to what’s going on with the world as a whole. Anyone living in America now knows that even though our government isn’t calling this an official recession, it is. However, it’s not just us. There is a worldwide recession… except maybe not in Dubai.

Japan is in the same boat. Citizens and the government have massive debt. Banks are cutting off funding to construction and real estate. Companies are going bankrupt. And while Japan is focusing on problems of the big companies, smaller companies and normal consumers are having a hard time obtaining credit.

So who benefits from all of this?

The Yakuza have stepped up and begun taking advantage of the hard times for these small businesses. Faced with going bankrupt, people have chosen to borrow money from yakuza backed loan sharks.

Banks in Japan have stopped transactions with 12% more companies in July than last year at this time. So these companies have no where to go but to the Yakuza. In 2006, to stop inflated interest rates and extortion, the Japanese government imposed a 20% cap on all interest rates. However, this law is hardly enforced. The Yakuza are able to charge whatever percent interest on the money with very little legal recourse.

These are bad times indeed. And things are expected to get even worse before they get better.

Via The Sydney Morning Herald.

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Technorati Tags: ヤクザ, やくざ, bankruptcy, credit crunch, japan banks, loan sharks, yakuza