BOJ keeps policy intact, cuts price outlook


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"...growth is not yet pushing wages higher..." 

Of course it isn't. Welcome to capitalism in the 21st century: the 1% and their immediate stakeholders receive the benefits of growth. Everyone else stagnates. This is what Abe should have expected when he signed on to "market reforms."

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BOJ is committing financial hara-kiri in the long-term, by buying not only JGBs but ETFs & J-REITs.

As a central bank it can conduct monetary policy via the bond market and interest rates. To buy stocks it is interfering into market & enterprises market pricing, creating mass distortion in the economy.

Now that Nikkei is at 21 year high, BOJ should back-off and stay within its realm of interest rates. 

As JeffLee has pointed Abenomics riches have been confined to an extremely small group of stakeholders while the rest of population are left behind. 

Investors should take advantage of BOJ and dump stocks at it, and shift to overseas stocks & enterprises.

BOJ unconventional experiment will end up in tears for Japan; how can BOJ support both bond & stock markets when time come for it to exit? This is not an academic issue, as other major central banks have already started the process to wind down their extreme monetary measures. BOJ should at least wind down its stocks intervention measures in ETFs & J-REITS if it still decides to "own" the JGB market.

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It’s winding down the JGB purchases already, in practice, without admitting as much in words.

With news of scandal after scandal in stodgy old companies, the PM requesting companies raise wages by specific amounts, and more plans to spend more tax payer money to make things ‘free’, I see nothing of interest in Japanese stocks at all. Fine for short term speculation perhaps, but what’s going on here is not something to ‘invest’ in. That the BOJ is currently buying stocks too provides me with no confidence at all.

Welcome to capitalism in the 21st century: the 1% and their immediate stakeholders receive the benefits of growth. 

Japan doesn’t have free markets and capitalism, I hasten to add. Like Chairman Xi talks of China’s socialism with Chinese characteristics, Japan has capitalism with loads of Japaneseisms, but it isn’t working at all. Socialism essentially is central planning, whereas Capitalism is the opposite - decentralized decision making by individual consumers and producers. This hasn’t been set up in Japan however as the govt maintains overwhelming control over many aspects of how actors may act in this economy.

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