While the world’s attention was fixated on US$ repo for once, the Bank of Japan held a policy meeting and turned in an even more “dovish” performance. Likely the global central bank plan had been to combine the Fed’s second rate cut with what amounted to a simultaneous Japanese pledge for more “stimulus” in October. Both of those followed closely [...]
With China closed for its National Day Golden Week holiday, the stage was set for Japan to steal the market spotlight. If only briefly. The Bank of Japan announced last night that it had had enough of the JGB curve. The 2s10s very nearly inverted last month and BoJ officials released preliminary plans to steepen it back out. Japan’s central [...]
There are things to feel optimistic about. I’ve been pegged as a doom and gloomer, and so long as things remain as they are, I don’t see what’s wrong about it. Long term, however, I’m as optimistic as anyone. There’s a gigantic wave of economic growth and prosperity just waiting to be unleashed – the moment the shackles of benign [...]
For a lot of people, a recession is two consecutive quarters of negative GDP. This is called the technical definition in the mainstream and financial media. While this specific pattern can indicate a change in the business cycle, it’s really only one narrow case. Recessions are not just tied to GDP. In the US, the Economists who make the determination [...]
Last April, monetary officials in Japan were publicly contemplating ending asset purchases under QQE. This April, they are more quietly wondering what other financial assets they might have to buy just to keep it all going a little longer. I’d suggest something like the clouds passing over the islands or the ocean water surrounding them. Nobody would notice either way [...]
In Japan, they call it “powerful monetary easing.” In practice, it is anything but. QQE with all its added letters is so authoritative that it is knocked sideways by the smallest of economic and financial breezes. If it truly worked the way it was supposed to, the Bank of Japan or any central bank would only need it for the [...]
Were they rushed, or were they late? Middle 2000’s consensus put academic opinion on the latter. The Bank of Japan had been Japan’s central bank since 1882, but it hadn’t been allowed to become a modern one until years into the 1990’s crisis. When speaking on the topic, Economists mostly mean independence and mandate rather than monetary competence. This speaks [...]
Since I don’t speak Japanese, I’m left to wonder if there is an intent to embellish the translation. Whoever is responsible for writing in English what is written by the Bank of Japan in Japanese, they are at times surely seeking out attention. However its monetary policy may be described in the original language, for us it has become so [...]
Men have long dreamed of optimal outcomes. There has to be a better way, a person will say every generation. Freedom is far too messy and unpredictable. Everybody hates the fat tails, unless and until they realize it is outlier outcomes that actually mark progress. The idea was born in the eighties that Economics had become sufficiently advanced that the [...]
A year ago, central bankers were over the moon. From those in the US to those in Europe, with Japanese officials in between, they really thought they had it. There wasn’t much basis for the belief, mind you, merely the fact that positive numbers were registering in all those places at the same time. Like some old Three Stooges movie, [...]
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