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The main Japanese stock index plunged 3.2 percent today, reaching a 19-year low and reawakening fears that Japan is about to be swept by another banking crisis.
With American markets closed for the Labor Day holiday on Monday, Japanese analysts, investors and money managers seemed to be taking their cues today from mounting evidence that Japan's mild recovery may halt or reverse if the American economy falters again.
Figures released by the Japanese government last week confirmed that Japan's economy remains highly dependent on exports for the meager growth it has managed recently. Any slackening of demand in the United States for Japanese goods could throw Japan back into recession. And the signals from the United States have not been very promising.
Japanese banks are very vulnerable to slides in the stock market because they hold huge portfolios of stocks and depend on them for much of their capital. In the past, the banks had great leeway in deciding how to value the stocks on their books, and could ignore short-term market swings; the portfolios were useful in generating capital gains on appreciated stocks to cushion profits.
7:48:02 AM Google It! 
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