New York -- Money is a global commodity, just like cars, radios and televisions.
But unlike the Sony's, Toyotas and other Japanese goods that dominate this city's eyes, ears and streets, the major Japanese investment banks have failed to have their product -- money -- become common currency on Wall Street.
Because these firms consolidate figures from their small New York operations into their vast, Japan-generated results and are notoriously reticent about providing information, hard facts are scarce.
Two of the so-called "Big Four" -- Daiwa and Nikko -- have lost money on U.S. operations in at least one of the past three years. The other two, Nomura and Yamaichi, may have lost money as well. And the profits for all, in terms of return on investment, have been minimal.
"I do not think they are a competitive factor in the market," said Jean Louis Lelogeais, a partner at the consulting firm Booz Allen & Hamilton Inc., echoing comments by other traders and bankers.
In the well-scrutinized data published by IDD Information Services, none of the Big Four is among the leaders in underwriting, the core of investment banking. Nor do they have a strong presence advising on mergers, or restructuring, or any of the other important niches in the investment world. Nikko, Nomura and Yamaichi have some presence in these areas, through investments in U.S. securities firms that have been only modestly successful.
The Big Four's experience suggests that for investment banks -- like advertising agencies -- the notion of worldwide operation has proven more intriguing than feasible. "While the marketplace for money has become global, the vendors have not moved toward global status at nearly the same rate," said Samuel Hayes III, a professor of investment banking at Harvard Business School.
The Japanese have made their presence felt in some areas by their willingness to absorb low margins. "There are certain businesses that you can buy your way in, such as the government bond market. But when it comes to value-added business, which is not driven by price, they haven't had much success," Mr. Hayes said.
Yet even in the government bond market, business has been tough. Foreign purchases of U.S. debt soared during the 1980s, and the Japanese firms took increasingly large shares of the market. But both foreign buying and the Japanese percentage of foreign buying peaked in 1989 and have been declining ever since, according to the Securities Industry Association.
Still, the Big Four haven't given up, reflecting patience in a world where typically there is none.
The firms appear to be reshaping their U.S. ambition again.
Their initial strategy, from the 1950s through 1970s, had been to tap then-abundant U.S. capital for Japanese investment. Problems arose in the mid-1980s when an abundance of Japanese capital and large profits at home stoked ambitions. Between 1985 and 1987, U.S. employment at the four approximately doubled. Fat contracts were extended to experienced bankers and government officials perceived to have Washington contacts.
The 1987 crash prompted a severe re-examination. Nikko Securities, for instance, purged an entire equity research team that had just been put in place. The other firms also cut back. Culture clashes sparked many resignations, and disappointment was pervasive on both sides. Any thought that Japanese employers were more stable than their notoriously unstable U.S. counterparts was dashed.
Today, the goals are more modest. Big Four executives suggest U.S. operations could serve as much as "periscopes" for financial innovations as independent profit centers.
The most coherent and comprehensive effort is being made by Nomura, the largest Japanese firm. It hired the former head of Kidder, Peabody & Co. Inc., Max Chapman, who brought in a team of highly sophisticated traders. Nomura has been one of the most aggressive program traders on the New York Stock Exchange recently. It also has developed a large presence in mortgage-backed securities -- bonds created by melding thousands of mortgages. And it is making a concerted effort in options, futures and complex "derivative" securities that meld all of the above.
"Our goal is to learn how to take more risk to get a larger return," said P. J. Johnson, a company spokesman. "We have to learn how to commit capital."
Daiwa and Nikko also are moving into mortgage-backed securities. One attraction may be that securities backed by assets, such as mortgages and car loans, may one day be sought-after in Japan. Another attraction is that entry barriers are low.