Senior LDP official calls for fiscal spending amid stocks rout

They call for fiscal spending when they have the highest debt to GDP in the world?? Just how insane can they get?

Senior LDP official calls for fiscal spending amid stocks rout

Because it worked everytime they tried this before?

Finance Minister Taro Aso said on Tuesday the government had no immediate plans to craft a new fiscal package.

... but it is straight out of the LDP playbook, and in the absence of better policymakers, this is what they will resort to.

“The yen is being bought as a safe-haven asset, which shows that investors think Japan’s economic fundamentals are solid,” Economics Minister Akira Amari told reporters

... to much ironic laughter?

Shows you the depth of intellect within the LDP, Japan is drowning in debt so their solution is to just pour more on.

I wonder if there's any concrete involved in these spending plans?

When the J-Gov says "Fiscal spending" it translates to Yakuza construction contracts and the related kickbacks to the OldBoys in back offices.

At least one official has his head screwed on straight, unfortunately he is in Australia. Australian central bank head Stevens was out with a speech today, about reforms / growth.

http://www.rba.gov.au/speeches/2015/sp-gov-2015-08-26.html

Reasonable people get this. They also know, intuitively, that the kind of growth we want won't be delivered just by central bank adjustments to interest rates or short-term fiscal initiatives that bring forward demand from next year, only to have to give it back then. They are looking for more sustainable sources of growth. They want to see more genuine dynamism in the economy and to feel more confidence about their own future income.

So ... a key question worth asking is: how do we generate more growth? Not temporary, flash-in-the-pan growth, but sustainable growth.

I believe the same is true of most people in Japan, yet for some reason these LDP guys keep getting voted in. What's up with that?

Japan’s government must compile a supplementary budget for fiscal spending to support the economy in the wake of declines in global stock prices, a senior ruling party official was quoted as saying by Kyodo news agency

Straight out of the LDP playbook -- use any excuse to throw more government spending at their supporters. But, bottom line, all it shows is how truly weak they believe the basic economy is, as they do not feel it can handle any crisis without massive government intervention. .

Japan is so deep in debt and fiscal responsibility is urgently needed. That's the line you've been hearing from intelligent and serious people for some decades and the government bonds has been....ever higher for decades.

and the government bonds has been....ever higher for decades.

and nominal growth has been... stagnant for decades.

For no discernible benefit at all, it doesn't appear to have been a risk worth taking.

fxgai, you are right about nominal growth.

Still, deflation is bad for debtors (Japan) and nominal wages and prices have to be adjusted sometimes. Inflating debt away is an age-old trick of economic management and that is the discernible benefit.