Japan

The parallels are building.

The New York Times offers a sharp new article here.

For those in a considerable hurry, let me offer a few bits from this worthwhile read:

Only in 2003 did the government finally take the actions that helped lead to a recovery: forcing major banks to submit to merciless audits and declare bad debts; spending two trillion yen to effectively nationalize a major bank, wiping out its shareholders; and allowing weaker banks to fail.
By then, Tokyo’s main Nikkei stock index had lost almost three-quarters of its value. The country’s public debt had grown to exceed its gross domestic product, and deflation stalked the land...

...the Japanese first tried many of the same remedies that the Bush administration tried and the Obama administration is trying — ultra-low interest rates, fiscal stimulus and ineffective cash infusions, among other things. The Japanese even tried to tap private capital to buy some of the bad assets from banks, as Mr. Geithner proposed.
One reason Japan’s leaders were so ineffectual for so long was their fear of stoking public outrage. With each act of the bailout, anger grew, making politicians more reluctant to force real reform, which only delayed the day of reckoning....

Also encouraging is this article Large Banks on the Edge of Insolvency, which states forcefully:

Instead, the experts say, the government needs to plunge in, weed out the
weakest banks, pour capital into the surviving banks and sell off the bad
assets.

Let's hope this is a sign that the scattered voices calling for a more forceful (effective) solving of the problem are beginning to be joined by more and more of the media.

Update: (from many lips to God's ear -- since I wrote this, the media is seriously talking about it on a widespread basis, starting with the Sunday talk shows.)