Corporate Japan achieved a rare feat in the fiscal year that ended last week. None of its almost 4,000 publicly-traded firms filed for bankruptcy protection.
Yet that's no reason to celebrate, according to analysts who see easy credit conditions standing in the way of a much-needed, corporate restructuring to flush out failing companies and make room for new businesses.
"It's totally unhealthy," says Martin Schulz, an economist at Fujitsu Research Institute in Tokyo. "Japan's business cycle isn't working. When no old companies go out of business, no new ones can come in because there isn't room. The old companies will always compete on price, simply because they can."