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Bank of Japan Posts Whopping ¥233 Billion Loss As Its Soaring Balance Sheet Hits Record ¥156 Trillion
But... but... a central bank can never lose money. Bzzzz, wrong. As it just so happens, the world's most tragicomic farce of a central bank, and one which is about to officially lost its (faux) "independence" and become a branch of the Japanese government if the up and coming PM Abe has his way, the Bank of Japan, just reported that in the quarter ended September 30, the Japanese central bank reported an operating loss of ¥183.4 billion, and a net loss of ¥232.9 billion. As a comparison, the loss in the same period in 2011 was "only" 91 billion. This is a harbinger of the total collapse that is the utterly meaningless capital tranche of all central banks will go through before the terminal phase of the global Keynesian experiment is finally completed. But in the meantime, enjoy this chart of the Bank of Japan's balance sheet returning back to a record ¥156... trillion.
And for those who enjoy having fun with google translate, here is the BOJ press release. Red - amusement follows:
128th fiscal year financial statements for the first six months (FY 2012)
Assets and Liabilities
Looking at the situation of assets and liabilities at the end of the first half of fiscal 2012, compared with the end of the previous fiscal year increased by 12 trillion yen 2,317 billion (+8.9%), total assets are 149 trillion yen 9,208 billion, mainly government bonds was. In addition, compared with the end of the previous fiscal year increased by 12 trillion yen 3,019 billion (+9.1%), total debt was 4,410 billion to ¥ 14.7 trillion center (current account) deposits.
And is as follows: take a closer look at these changes in the assets and liabilities of the Bank of Japan. First, looking at the part of the asset, from the fact that government bonds, etc., etc. The amount of the purchase exceeds the amount of redemption, and 102 trillion yen 8,593 billion, more than 18 trillion yen 4,922 billion of the previous fiscal year end (Tasu21.9%). On the other hand, due to a decrease in funding due to funds-supplying operations against pooled collateral, and 34 trillion yen 4,435 billion, less than 8 trillion yen 4,959 billion the prior year end loans, (? 19.8%). The balance of assets purchased by the Fund "such as asset purchases", to ¥ 61 trillion 7,729 billion.
Then, looking at the part of the debt, primarily due to funding through the Fund "such as asset purchases", and ¥ 43 trillion 9,683 billion, more than 9 trillion yen 3,278 billion end of the prior year current account, (+26. 9%). During this time, the 80 trillion yen 9,287 billion, and more than 2 trillion yen 45.8 billion the prior year end balance of ticket issuance, the Bank of Japan (+2.6%).
Profit and loss situation
As for the status of the profit and loss for the first six months of fiscal 2012, ordinary income was a loss of ¥ ? 1,833 billion (ordinary loss). This is intended to primarily driven and that the income related foreign exchange has become more than loss significantly due to the strong yen, that income investment (equity trust property) became super loss money held in trust due to the impairment of shares held is.
Like that it has made trading losses reserve fund of index-linked exchange-traded fund, special income, to ¥ ? 468 billion.
As a result, loss of ¥ ? 2,329 one hundred million surplus before income taxes, surplus income after deducting next (Fri loss before income taxes), corporate income tax, the business tax and residence tax yen ? 2,302 million, income ( I became a gold) loss.
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I guess if control of the BOJ truly is taken away from the BIS, we can expect to see Japan go first, and very soon at that.
To hell with Godzilla, this looks more like Tetsuo at the end of "Akira".
http://www.theatlantic.com/business/archive/2012/11/is-our-debt-burden-r...
thats what they get by fighting the feds devaluation.
tick, tick, tick....boom
Kyle Bass sees this chart & gets a chub the size of the Empire State Building
Our Fed is leveraged 52-1. If the interest rate increases 44 basis points they start losing money. 52-1, I think it’s a safe bet they go under and become a printing press in a short amount of time.
My blog. http://www.floridapoliticalpress.com/2012/11/28/the-fiscal-cliff-was-199...
15 years of deflation has allowed Japan to keep interest rate near zero.
New debt services old debt at no extra cost.
This can go on indefinatley.
If/when prices start rising, they are screwed.
their debt service cost has been in a trading range for a decade---30 year about 1.00% in 2003 to the just below 2.00% today----so without lowering rates (theres almost nowhere to go lower) they are already deeply fucked-----usa is closing in on japans 30 year bonds trading range of 1.00-2.75%
They won the inverse powerball.
This is the Bank of Japan. If you're squeemish, don't click (it's a medical type thing):
BOJ Lancing Begins, Bitchez: The Lance, Purge & OozeTsunami, LULZThe Fed and ECB are going to be EPICALLY ripe when they need to be lanced, as well. Respositories and pustules of sepsis and toxins, unite!
Can unauditable, uncontrollable central banks actually go "bankrupt?" Don't they just create more "money" if they lose "money" on prior "investments?"
This isn't a rhetorical question. I actually would like to know whether or not its possible. It seems the only thing about them that can go "bankrupt" is if trust in their funny money fades, their charter is removed and the supporting cartel is dismantled.
C'mon, it all depends on your definition of "money."
This isn't a define "is" swipe of hand. It's actually the key to truly understanding the Ponzi of a foundation our Modern Money Mechanics economy is built upon.
Gross, fuck.
I plus 1'd you to offset the negs b/c you're clearly an abscess newb and just popped your cherry.
Not that we shouldn't wear our negs as scarlet letters.
Right - the grift continues until the mark gets wise to the con, or he runs out of dough.
It can carry on longer, if the mark has a gun to his head.
CB don't go bankrupt, but at one point people lose confidence in the currency. This generates an exchange rate crisis which can turn into hyperinflation. To avoid that, a currency control is put in place. The stage is then set for raging inflation as everybody runs for real assets for protection .... and the central bank has to raise the interest rate sky high to avoid that.
Trust a south american (one that one....) I was a CFO when Brazil experienced an inflation of 70% per month....(Feb 1990)
eeeeeeeeeeeeeeehhhhhhhhhhhhh..... naaaaaaaaaaaaaaaasty..... effing throw up type nasty..
I sincerely find watching that cathartic, but then again, I wanted to be a surgeon from the age of 6.
I'd like to do that to the Fed, ECB & BOE (I have a compulsive desire to slice the toxic entities open wide, pus flying through the air, abscess drainage squirting everywhere, and just stick a shunt drain tube in those open, septic wounds), but I'd need to don a proper and full Hazmat Level A (or prEN 943 part 1 by EU standards) suit after scrubbing.
*No more "ewww, gross" comments. I put a caveat warning in there for a reason. Man up, or pretend it's twinky filling.
everyone's such an alarmist these days! it's only BACK to the 2005 levels. Let's not got our panties in a bunch until Abe brings that total to ¥360T, okay?
MAX DOES WESTMINSTER (Final cut)
http://maxkeiser.com/2012/11/28/max-does-westminster-final-cut/
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How does a CB lose money?
zirp + stocks + fx
zirp + stocks + fx / stupid
fixed it for you
Think about the reality of the Fed's balance sheet, extrapolate recent (4 years especially) actions that would impact asset and lie-ability sides and then ask yourself that question again.
Perhaps a CB's job IS to "lose" money.
Remember the stuttering answers to Senate hearing questions by the Beard and his team regarding TARP etc.?
Smoke, mirrors and dark pools.
ori
here is what the dork said ...
The Dork of Cork. | November 28, 2012 at 6:01 pm |
http://archive.org/details/AV_422-S_and_L_UPDATE-PART_I
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at mkfwr.
Printing paper is so much fun!
156 Trillion ... zzzzzz ... wake me when were talking about the big Q as in Quadrillion.
9,12,15 0's ... whatever its all good.
... and the yen still won't go down.
chicken - egg
Wow! I wasn't expecting such great newses all at once? Maybe we can get Boehner and Obomber to come out and scratch each others balls on TV again ad really get some equity action goin!
everything's now fucking bullish.
Fuck you all central bankers. You fucking fucks, fuck off and fucking die.
Central banks have no need for the concept of "loss" or "equity." They print money out of thin air for such. There is no need for them to worry about that at all. Non-story.
No worries! It's all contained to sub-Japan!
We GOT this shit! Buy buy buy!
That's less than two billion dollars. Not significant.
Swiss National Bank just confirmed holding 12% of currency reserves in stocks!
I will simply make a $100Trillion donation to them and solve all their problems - got a fresh crisp $100Trillion Zim bill hanging on my office wall (got it for only $5 US). Just stick it in an envelope, mail it to BOJ, done.
lol no shit! no difference.
I got two 100 Trillions for $2.50. Gideon Gono must be inflating again. And here I was saving it for my retirement.
rounding error? lol who cares
lulz, yeah, they aren't worried about running out of yen
Is it really a loss if you can print it back?
No problem. You're just seeing "investment" cost from the coming profits on Japanese world beating Hello Kitty Adult Diaper technology.
Old people stuff is the growth industry of the future! Coupled with Fedgov Obamacare, it will make the Defense Iron Triangle look like a lemonade stand.
All your elderly Simulac with vodka chaser smeary poops are belong to us.
KenyanThugCare (aka, ObamaCare) will solve the adult diaper problem - if you are deemed "too old to repair" you will not get a needed procedure, and you will have to fork over the cash yourself for the triple bypass you need which means going to Mexico or somewhere affordable - good luck! Solves the old people problems of the govt, like medicare, soc security, etc. Done! Solved!
What are the numbers if marked to market?
Looks like Kyle Bass was correct about Japan and he'll make another fortune.
Kyle is correct, but people underestimate how long these sovereign fascades can be maintained.
Japan - been can-punting for almost 3 decades now
UK - been can-punting for half a century, +/-
Grab a Snickers.
"been can-punting for almost 3 decades now"
The problem for Japan is that this current juncture in history bears no resemblance to those previous three decades. I wouldn't bet against Bass, nor even grab a frozen Snickers, for that matter.
And CNBC was running a story today that the NIKKEI may be the "hot" new opportunity in equity investing.
ROFLMAO!
I'm just surprised that CNBC doesn't write it as 'HAWT'.
CNBC is right, that is great opportunity to find some bagholders.
forward, m'fkers
the short squeezes will continue until the morale improves
Big deal, the 14 millionth 'short squeeze' to nowhere.
isnt 233bil yen worth about $2bil usd....? our banks lose that every day.....
Could someone tell me how the Yen strengthens to the USD when the BoJ releases this blackhole of a balance sheet?
It was either "better than expected" or "not as bad as some feared". Take your pick.
Bank of Japan will be renamed Bankrupted Bank of Japan.
And no it doesn't mean 233 billion yen were destroyed. That 233 billion yen is still out there in the money supply.
It just means there's less value on the asset side, which should devalue the yen, but it won't, because (as I keep telling Tyler) it ain't tied to the asset side, not when it's an unbacked currency.
And come on, it's 0.14%, not even 1%, nowhere near "whopping".
A Central Bank's "assets" are the things that enable it to conduct monetary policy via Open Market Operations.
Less value on the asset side as a result of losses means that they are that much "less able" to conduct Open Market Operations. It may look insignificant with the Yen at these levels, but that could change quickly. Mounting Central Bank losses and a falling Yen could easily lead to a situation that gets out of control.
You mean they would need say... a PENTAKILLION bailout?
233B/156T = .15% If you inflate your balance sheet enough even 233B losses are de-whopped. Since mark-to-solvency asset value accounting is in effect and net worth is already a fantasy, no problem.
Welcome to the era of zombie central banks.