politics

BOJ's architect of 'shock and awe' plots retreat from stimulus

15 Comments
By Leika Kihara

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Imagine being able to fail at your job for years and still get paid!

8 ( +9 / -1 )

Some sentences in this column show BOJ's architect Masayoshi Amamiya of that 'shock and awe' plots retreat from stimulus, like as: "Neither plan was made public." "The Bank of Japan declined to comment for this article." "The move proved to be a disaster." "The BOJ is in a deadlock." that's enough crucial reasons to he be dismissed even he is has talents to play the piano, guitar and flute well. Insignificant stance to be in that authoritarian position.

3 ( +3 / -0 )

“I believe we are firmly on the path toward bold monetary easing,”

PM Abe. JAN. 22, 2013

No wonder one of my stocks took a nose dive yesterday.

0 ( +1 / -1 )

The move proved to be a disaster...

Yeah, a disaster for rich, powerful bankers. The economy expanded, corporate profits rose and unemployment was basically ended during the same period.

Amamiya...received daily visits from bank executives furious about low bond yields, which were crushing margins.

Sounds like a good idea to me to keep the stimulus going.

-3 ( +0 / -3 )

JeffLee: "Yeah, a disaster for rich, powerful bankers. The economy expanded, corporate profits rose and unemployment was basically ended during the same period."

More hogwash from a self-proclaimed economist. You're saying there is no more unemployment? hahaha.

-2 ( +1 / -3 )

So many new jobs being created in Japan but it’s a pity that most of them are temporary.......

2 ( +2 / -0 )

@smithinjapan

More hogwash from a self-proclaimed economist. You're saying there is no more unemployment? hahaha.

Settle down. In June, there were 162 openings for every 100 job seekers. Everyone in Japan who wants a job and and can do one can get one.

Full employment is defined at 5%. Japan's rate is 2.4%.

-1 ( +0 / -1 )

LET'S THINK TOGETHER

°

Thinking finance in english and monarchy is always a challenge. It is old memory but let's see what is left of it.

Guess : Long term advice to manipulate market is not fully legal on the world market. It tweaks it. Your political friend makes money, the others loose money, and your campain is founded.

Buying Public bonds

Public bond is the state way to have money to pay for their debt (paying SDF for example). They put it on the investment state, the bond market. Then it can be exchange on the smaller finance market.

The BOJ money mission

Interest rate served as a retribution for the loaning of money to the private and public sector. BOJ fixed it.

The Smaller Finance Market

The Money market is a place where you sell and buy without much regulation every capitals your company don't need. It means long term and short term titles can be found on this market. Bond is a long term title. BOJ buy state debt to company and public to send direct money into economy.

BOJ is not supposed to buy direct state debt or use its reserves. It is forbidden to finance state unless your economy is very ill.

This monetary policy is made by creating money and not using BOJ reserved. It create inflation when the money is reinvested on short term expanse inside the country.

This is a simple way to create inflation inside your economy by incerting lot of money (money easing).

It is supposed to be efficient in a country where firms are loyal to the state.

The Japan Case

Since Japan own Japaneese debt, it was supposed to be still efficient without a doubt.

Japaneese loyalty to the country made sure to invest it into the country. But instead it was probably used to buy USA debt bonds and beat China. So there was economy disloyalty. It puts Japan economy at huge risk. Normally, japan economy should lose one A.

It seems international politic influence firms investment. The japaneese people was sacrified.

Loaning money to the public sector

The BOJ propose to buy credit line at fixed price. The interest rate is this fixed price. When it is negative, BOJ pay actors for using the money.

It is very interesting to be paid to invest. Firms will put a strong influence to not have to pay for credit lines and may be make you governor. But with Trump a big change was coming, the stability long term amamiya system is not insured anymore.

FED to help america war passed in 0% interest rate too in 2001. Instead of emitting bonds, USA use FED to finance war. Now, Trump and FED have levelled up the rates. It is 2 %. USA started emitting bonds again at lower rate and with a safer range.

My guess is japaneese firms have bought usa bond instead of easing the economy with money.

Why buying public debt ?

It is often more stable than money that can fluctuate more. State bond are supposed to be safer than money unless the state crash. Japan economy is not as good as usa with disruption at its frontier.

To conclude

BOJ is a cheater and corrupted central bank. It put Japaneese economy under big pressure. It is time Japan clean BOJ and start to behave more like the third world economy and not just a rich political banker.

Amamiya will win a reincarnation in China with his friends. This is where liars and yakuza seems to end in after life.

°

NCM

-2 ( +0 / -2 )

Well, thanks for trying. Now can we atleast get zero atm fees for customers using their banks atms regardless of day or time?

0 ( +0 / -0 )

@shenjingbing

°

No, the BOJ reflation policy didn't get to real economy. So fees will rise because the money tree is working. America is probably buying yen to kept his level stable in exchange of his debt buying through japan money tree. So fees will not rise a lot.

Firms and Bank don't obey Abe anymore.

My country gave money thinking to an autonomous central bank outside the country. It is difficult to do old money thinking but Amamiya made a rooky mistake trying to pay firms to trade capital for cash; or this is Japan making money war with China by helping america (and lying to the japaneese people about money easing to create inflation and make firms start to pay for their lawn).

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NCM

0 ( +0 / -0 )

Weak yen.  Low unemployment but plenty of poor workers who have low pay and zero employment rights.  Massive debt.  Illiquid markets because BoJ buying anything it can.  Distorted economy.  Arrow 3 never fired.

BoJ plus Abenomics has been a washout at least judged against its stated objectives.

Will be fascinating to see if they are as inept at getting out of this hole as they were falling into it in the first place.

1 ( +1 / -0 )

@wakarimasen

°

Japan is wise in trading. It is a strategy based on firms loyalty. It is a a solid building but the world market tend to weaken nationalism loyalty to just make as much money as possible.

I am more worried about his extreme right standing. In today's world, it is deeply worrisome.

°

NCM

0 ( +0 / -0 )

@Nadege

This is a simple way to create inflation inside your economy by incerting lot of money (money easing).

Not really. Monetary easing involves taking the same value of bonds out of the system, so you may be "inserting" but you're also "removing" other assets at the same time. Those assets pay holders a return, while cash does not. This is why monetary easing is not inflationary.

Then there's deleveraging among businesses, the liquidity trap, etc.

I wrote this a few years back, and was harshly criticized. Events have proved me correct and my critics wrong. I mean, just look at all that Japanese inflation after years of massive easing. LOL.

0 ( +0 / -0 )

"A fan of classical music who has recently begun to favour Russian composers, Amamiya plays the piano, guitar and flute well"

I swear, every time I read a profile of some elite, Todai-educated Japanese bureaucrat (Amamiya graduated from Tokyo University), inevitably it is mentioned that he (always "he") enjoys the finer things in life like European classical music or French cuisine. This kind of information is irrelevant. Why do the hobbies of elite Japanese bureaucrats always get mentioned in articles like these? Does somebody out there have a vested interest in letting us know that Japanese bureaucrats are apparently a highly cultured and sophisticated bunch? It's almost as if Reuters & Co. have orders to publish propaganda.

1 ( +1 / -0 )

The BOJ can easily induce inflation but it won’t as the mass consumers in Japan have not been given any monetary mechanism by which they may raise prices by the government.

Abe’s government has forced workers into temporary contract work with no job security.There are offices in Japan full of contract workers on minimum pay being leeched by intermediary despatch companies-no wonder women are not having kids!

Land employment figures are completely skewed in Japan part time work outnumbering full time positions.

And it is worth asking why Abe’s government and the BOJ can fail yet the wealthy japanese become wealthier at the expense of the less wealthy.

0 ( +0 / -0 )

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