TOKYO MEDIA REACTION - USG BAILOUT OF FANNIE

UNCLAS TOKYO 002463 SIPDIS STATE FOR I/RF, PA/PR/FPC/W, IIP/G/EA, EAP/PD, R/MR, EAP/J, EAP/P, PM; USTR FOR PUBLIC AFFAIRS OFFICE; TREASURY FOR OASIA/IMI; SECDEF FOR OASD/PA; CP BUTLER OKINAWA FOR AREA FIELD OFFICE; PACOM HONOLULU FOR PUBLIC DIPLOMACY ADVISOR E.O. 12958: N/A TAGS: OIIP KMDR KPAO JA SUBJECT: TOKYO MEDIA REACTION - USG BAILOUT OF FANNIE MAE AND FREDDIE MAC ¶1. LEAD STORIES: Front-page items on Tuesday morning included DPJ President Ozawa's effective election on Monday to a third term as head of the leading opposition party, as no one filed to run against him, as well as the official announcements on Monday by two candidates for the presidency of the ruling LDP. ¶2. "More Needs to Be Done to Ease Anxieties About U.S. Financial System" The business-oriented Nikkei editorialized (9/9): "The U.S. has moved to rescue two troubled housing mortgage firms, taking control of the companies and injecting public funds. These measures will head off a potential worldwide financial crisis sparked by credit insecurity in the U.S. However, more remains to be done to ease financial anxieties, as housing prices continue to drop, and there are many private financial institutions whose assets remain at risk. The risk of a vicious circle of a credit crunch and a deteriorating economy still remain." ZUMWALT