member companies under them who operate in each of the major critical business area. These include banking, distribution, steel making, and manufacturing. Each of the companies in the cartels is independent and very focused in what they do in all senses of the word except for loyalty. Their individual independence is what keeps things from getting too complicated and out of control. However, they are able to unite for issues important to the national or keiretsu effort.Every cartel has a bank that is the heart of the alliance and is similar to a national central bank. The bank takes foreign cash from winning companies in the keiretsu and gives it to new gambles in the union with out limiting them. This banking system is what enables Japanese companies to make very long term investments which US firms cannot make (since US investors are usually more reluctant to risk and are not as patient for returns as Japanese cartel banks are).In upcoming technologies such long-term investment before any payoff is vital. In these types of technologies Japanese firms, due to cartel banking, have enormous financial advantage over western companies which are not allied with each other. As a result, Japanese firms in keiretsu groups are much more likely than US firms not involved in keiretsu to invest large sums of money in long term projects. Therefore, their way of banking turns out to be more efficient and helpful to industries over ours.As a result, Japanese firms ultimately defeat foreign competitors and win in the market. Ironically, many US banks and investors, aware of what happens to industries targeted by the Japanese, act oppositely, avoiding to loan money to US company in an industry besieged by the Japanese (Hillenbrand 20). US investors know that it is almost impossible for independent US companies to survive against organized Japanese cartels and consequently, tend to abandon such US firms. This fact puts US companies at a bru...
