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Japan to help finance European bailouts

25 Comments

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25 Comments
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Why??!! It's absurd to do so at a time when the Japanese govt. is crying poor mouth about not having funds to cover the annual budget and foaming at the mouth to raise various taxes on the public. Unbelievable!!!

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Because they sink, you will sink as well. The forex is worthless then.

Just follow the Chinese steps, it couldn't be wrong.

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Japan needs to sort its own debt bomb out before buying some one elses debt.

Serious problems loom.

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bengoshi-san, well, you're quite wrong there - now that the yen is extremely strong, and considering Japan has huge debt itself, it is the time to use some of the reserves outside (money sitting are not worth the paper they are printed onto, they should be rolling)... If even one country in Europe is in big(ger) trouble, the whole EU economy (and the world's) could come crashing down, and Lehman shock would be nothing compared...

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Why? Money is only money, but friendships are enduring.

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Good timing considering the strong yen. Smart move

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Japanese taxpayers, they mean.

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Japan trade surplus is going down the drain with 259.7 billion yen this month from 912.9 billions last month. Japan is closed to get in a trade deficit like briefly in the mid 2009. Just printing like US does won't lower the yen. Massive sell of yen on the market isn't either (like they did twice with no result) Trying to contain the European debt hemorrhage by participating in the bailout is only thing they can do. This is no altruism but business.

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If this could help alleviate endaka, then it might be a smart move on the JPN government's part after all.

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apecNetworks :

Money is only money, but friendships are enduring.

Only in your dreams.

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Tumbledry :

This is no altruism but business

Yes . . and a a bit of a gamble.

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semperfi: agree. better take a risk than just Japan sitting on their hands as usual.

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To Semperfi,

I don't want to sound sooooooo idealistic, but to some degree, APEC would not be what it is except for strong relationships. However, many in the US during the 1990's saw this as "cronyism". The lowest product price is not everything.

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Usual central bank smoke and mirrors magic tricks. The Irish and other countries' debts will never be repaid and they know it, this is just about the BOJ doing their part to help bury the bodies and make sure banks don't have to deal with that nasty capitalism thing.

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GJDailleult: I found disgusting that banks used/wasted our money in their shady businesses and now, us, taxpayers have to give them money so they don't go bankrupt and loose all our money. The Ponzi scam is still alive and fat cat bonuses too.

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200% Debt to GDP ration indicates that Japan is more than capable of doing this. Bravo!

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TumbleDry- People can argue all day about the role of government in the economy (subsidizing business etc.) but banks are a different case. Once banks are no longer subject to market forces (ie. accountable for their losses), your pretty economy is pretty much toast. There is no economic justification for rescuing banks, you just shut them down and start over. Sweden proved that in the 1990's. But the people in charge care about the Ponzi, not the economy. Eventually though a dumb parasite will kill its host, and unfortunately that seems to be where the world is heading.

As for what the BOJ and other central banks are up to here, I don't claim that I can figure out the details. But I am pretty sure they are up to no good, at least for anybody other than banks (especially German ones!).

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There are so many homeless in Japan living in the cold in those blue tarps. Give them shelter before helping out Europe.

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Like China buying debt from Ireland, Spain and Greek? Do Asia is entering in a "White Knight" "business" trend? Dont take me wrong, I think that is a noble thing to do, is just that I am shocked, after all the critics about our economy that some noisy westerners stated.

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WOW! There are so very many Japanese people who really need help here nowadays. This is all quite surreal, indeed. But, behind China, Japan actually has the second highest account surplus in the world weighing in at approximately 13 trillion dollars. Therefore, in order to help prevent a systemic global economic collapse, it is imperative that Japan provides financial support in Europe.

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People can argue all day about the role of government in the economy (subsidizing business etc.) but banks are a different case.

It's contrary to so-called microeco. reforms anyway. But c. banks have been politicized-- it'll be sensible for a c. bank to remain independent BUT... post-GFC I'm not too sure anymore. Just check out measures that c. banks in the region already dismantled because of 'unpopularity'!

And sadly with the amount of changes, u-turns that a c. bank implements in a short period of time-- it risks losing its credibility.

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.

Europe’s bailout fund, which is aimed at rescuing Ireland.

Republic of Ireland is the one needing resuing.

We in Northern Ireland, (part of the United Kingdom) are helping with the loan to bail out the republic.

Portuguese officials have sought the help of China, which has already used its foreign currency reserves to buy Greek and Spanish debt

When the weeker countries needed a bail out, it draged the euro down and effected the other euro using countries.

If R.o.I. hadn't joined the single currency, would they be in this mess ?

In the R.o.I., the first vote was NO, but then the R.o.I. goverment went and did a 2nd vote and it was a YES.

Wonder what it would be now ?

Wonder how long before chinese becomes the main language in europe. Why invade to take control of a country like in the past, when you can buy the countries.

.

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Buying bonds is not the same as donating money....the poor in Japan will not suffer because the BoJ makes investments, in fact its considered a stabilising move for the European and Japanese economy. Thus if it achieves stability the numbers of homeless in Japan might not decrease but they wont rise either...hopefully.

Though Ireland is costing the EU 70 billion, there still remains about 450billion in funds which they say should cover portugal and belgium. (That figure needs double checking sorry) so Im surprised they are selling more bonds unless when they release that figure they didnt actually have the cash in hand. Probably Germany doesnt want to pay more from its own coffers

Here in Europe, Germany and UK are calling for change to the maastricht treaty to make it harder for EU countries that need bailing out. Portugal and Belgium are said to be next. Italy is in dire straits and experts predict Spain will bounce out of it due to strong tourism,exports and austerity packages being pushed thru. Recently China did purchase huge amounts of Spanish debt (thankfully!) and ...after failing to purchase armaments from Spain as the deal was blocked by the EU....though there is no fear of direct interference by the masive debt buyer the presence of chinese discount stores and other such businesses is sharply increasing! ..if the locals dont work hard the chinese will!

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Buying bonds is not the same as donating money....the poor in Japan will not suffer because the BoJ makes investments, in fact its considered a stabilising move for the European and Japanese economy.

Obviously there are some consequences to buying bonds-- the same as any investments-- but European economies are important trade partners, and you're right to point out that recent moves of the GoJ had been stabilizing somewhat.

Though Ireland is costing the EU 70 billion, there still remains about 450billion in funds which they say should cover portugal and belgium. (That figure needs double checking sorry) so Im surprised they are selling more bonds

One of these mysteries of Euro bailout. In fact they have more than enough-- to cover the so-called P.I.G.S-- even before the Chinese, Japanese bond-buys.

So, thanks for mentioning.

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jruaustralia at 06:57 AM JST - 19th January. Obviously there are some consequences to buying bonds-- the same as any investments-- but European economies are important trade partners,

Doesn't matter. Despite the fact that we're seeing this increase in bond purchase by Japan and other international countries, it doesn't really change or address the underlying problem and that's not going to change until the European authorities themselves come up with a more comprehensive solution to mitigate the fallout from the debt crisis.

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