While I was a small fish at Oracle, I strongly proposed using Java for everything, including using it as the language for stored procedures. Using just one universally understood, and powerful language for all things has one major advantage to the development team as a whole. Everyone just need to be proficient at one IDE, and one language. Business logic, and the development process will be the only thing need focussing. And in time, performance will be less an issue because of improved hardware. Think about using 1000GB RAIDED hard drives getting Terabyes of storage,1GB FSB speed RAM, and 128bit multi-processosrs in 5 years...
Of course, PL/SQL is a beautiful stored procedure language for SQL lovers. Due to restrictions at a bank I worked for, I had to create ad hoc reports for bankers using 400-800 line single SQL statement. SQL is indeed a well proven expressive database query language. And for Oracle, and PostgreSQL, stored procedures are well optimzed for speed. So, for the time being, if speed is the most critical issue, I'll say that the old ways still rock.