Japan Considers Temporarily Nationalizing TEPCO

According to Japanese newspaper Yomiuri, authorities in Tokyo are considering a temporarily nationalization of TEPCO, the operator of the troubled nuclear plant.

The Google Translate version of the article is here (via Joe Saluzzi).

The details are a little unclear,a nd it’s clear that this is not a sure thing.

The key thing to bear in mind is that TEPCO has ALWAYS enjoyed the implicit backstop from the government, thanks to pre-existing regulations on nuclear power in Japan. Read the details here.

In Monday trading, TEPCO CDS exploded higher, thanks to the perception that the relationship between the operator and the government were fraying. Read more here.

chart of the day, tepco, cds spreads, march 2011

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