Kuroda says BOJ ready to do more for economy after state of emergency lifted

By Leika Kihara

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Reading just the headline it sounds like they (BOJ) have not done enough until now.

3 ( +3 / -0 )

The BOJ must understand that if consumers don’t have money then they can’t buy anything.

Shops will restock in vain and wonder why sales aren’t happening...

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The BOJ can further expand lending schemes, cut interest rates and ramp up purchases of exchange-traded funds. It can even come up with something new if necessary," he said.

Cue the boffins (not me, though) who said five years ago the BOJ had "run out of policy tools."

3 ( +4 / -1 )

The BoJ ran out of true ammos that can boost the economy back into normalcy, before the bubble burst. It is around 2015, coinciding with Shanghai stocks crash. The Bank of Japan created a devastating self-induced deflation, as Bernanke put, idiotically destroying domestic economy and people's livelihood for the sake of keeping the currency relevant. Yen maintains the reserve currency status.

However, BoJ's strategy of insane QE and unlimited bonds buying is particularly vulnerable to external shocks – such as the COVID19 pandemic. Since interest rates are already at record low levels, the Bank of Japan (BoJ) is left with very few tools to cushion any distress in the financial markets. If more foreign investors need to be found, the BoJ will request an appropriate yield reflecting their risk exposure. In fact, recent years have seen a steady increase in foreign buying of JGBs which threatens to undermine the BoJ’s yield control - these foreigners are likely short-sellers. Once the foreign investors lose faith in Japan's economy, the hyperinflation will happen and eventually lead into a national default.

Kuroda's biggest fear is hyperinflation, when the global market isn't fooled by Japanese mirage economy. When they realize that Japan will never pay back its bonds or investments.

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BOJ must understand that real value of JPY if abt 125 for 1USD or even less.

Japans economy survives from export and recent unreal rates makes japanese products highly incompetitive on world market.

when people have no cash left they will no spend.

as simple as is.

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Ah, Kuroda... still failing years later.

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Kuroda is so disingenuous. He knows very well that ,like other major central bankers, that their greatest weapon is quantitative easing which is guaranteed income for bankers. The message of no debt forgiveness is for the little guy.

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