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The BoJ Jumps The Monetary Shark - Now The Machines, Madmen And Morons Are Raging
Submitted by David Stockman via Contra Corner blog,
This is just plain sick. Hardly a day after the greatest central bank fraudster of all time, Maestro Greenspan, confessed that QE has not helped the main street economy and jobs, the lunatics at the BOJ flat-out jumped the monetary shark. Even then, the madman Kuroda pulled off his incendiary maneuver by a bare 5-4 vote. Apparently the dissenters - Messrs. Morimoto, Ishida, Sato and Kiuchi - are only semi-mad.
Never mind that the BOJ will now escalate its bond purchase rate to $750 billion per year - a figure so astonishingly large that it would amount to nearly $3 trillion per year if applied to a US scale GDP. And that comes on top of a central bank balance sheet which had previously exploded to nearly 50% of Japan’s national income or more than double the already mind-boggling US ratio of 25%.
In fact, this was just the beginning of a Ponzi scheme so vast that in a matter of seconds its ignited the Japanese stock averages by 5%. And here’s the reason: Japan Inc. is fixing to inject a massive bid into the stock market based on a monumental emission of central bank credit created out of thin air. So doing, it has generated the greatest front-running frenzy ever recorded.
The scheme is so insane that the surge of markets around the world in response to the BOJ’s announcement is proof positive that the mother of all central bank bubbles now envelopes the entire globe. Specifically, in order to go on a stock buying spree, Japan’s state pension fund (the GPIF) intends to dump massive amounts of Japanese government bonds (JCB’s). This will enable it to reduce its government bond holding - built up over decades - from about 60% to only 35% of its portfolio.
Needless to say, in an even quasi-honest capital market, the GPIF’s announced plan would unleash a relentless wave of selling and price decline. Yet, instead, the Japanese bond market soared on this dumping announcement because the JCBs are intended to tumble right into the maws of the BOJ’s endless bid. Charles Ponzi would have been truly envious!
Accordingly, the 10-year JGB is now trading at a microscopic 43 bps and the 5-year at a hardly recordable 11 bps. So, say again. The purpose of all this massive money printing is to drive the inflation rate to 2%. Nevertheless, Japanese government debt is heading deeper into the land of negative real returns because there are no rational buyers left in the market - just the BOJ and some robots trading for a few bps of spread on the carry.
Whether it attains its 2% inflation target or not, its is blindingly evident that the BOJ has destroyed every last vestige of honest price discovery in Japan’s vast bond market. Notwithstanding the massive hype of Abenomics, Japan’s real GDP is lower than it was in early 2013, while its trade accounts have continued to deteriorate and real wages have headed sharply south.
So there is no recovery whatsoever—-not even the faintest prospect that Japan can grow out if its massive debts. The latter now stands at a staggering 250% of GDP on the government account and upwards of 600% of GDP when the debts of business, households and the financial sectors are included. And on top of that there is Japan’s inexorable demographic bust—–a force which will shrink the labor force and squeeze even further its tepid growth of output as far as the eye can see.
Stated differently, Japan is an old age colony which is heading for bankruptcy. It has virtually no prospect for measurable economic growth and a virtual certainty that taxes will keep rising —since notwithstanding the much lamented but unavoidable consumption tax increase last spring it is still borrowing 40 cents on every dollar it spends.
So 5-year JGBs yielding just 11 bps are an insult to rationality everywhere, and a warning that Japan’s financial system is a disaster waiting to happen. But even that is not the end of it. Having slashed its historic holdings of JCBs, the GPIF will now double it allocation to equities, raising its investment in domestic and international stocks to 24% each.
Stated differently, 50% of GPIF’s $1.8 trillion portfolio will flow into world stock markets. On top of that—the BOJ will pile on too—-tripling its annual purchase of ETFs and other equity securities. This is surely madness, but the point of the whole enterprise explains why the world economy is in such extreme danger. A Japanese market watcher caught the essence of it in his observation about the madman who runs the bank of Japan,
“Kuroda loves a surprise — Kuroda doesn’t care about common sense, all he cares about is meeting the price target,” said Naomi Muguruma, a Tokyo-based economist at Mitsubishi UFJ Morgan Stanley Securities Co., who correctly forecast more stimulus today.
That’s right. Its 2% on the CPI…..come hell or high water. There is not a smidgeon of evidence that 2% inflation is any better for the real growth of enterprise, labor hours supplied and economic productivity than is 1% or 3%. Its pure Keynesian mythology. Yet all the world’s central banks are beating a path toward the same mindless 2% inflation target that lies behind this morning’s outbreak of monetary madness in Japan.
Folks, look-out below. As George W. Bush said in another context…..this sucker is going down!
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Print, mofos, print. That's all ya got, anyway. Then let's see you reign in any adverse effects "within 15 minutes".
Like fuk.
As they print, the paper corrupt futures markets are used to inaccurately 'price' commodities to hide the outright blatant central bank insolvency. This is a farce beyond all belief and will result in absolute failure.
I don't see how anyone accepts yen anymore. We are talking about an island that imports nearly everything, and here they are creating trillions of units of their currency out of thin air, and people are still willing I exchange real things for it. Amazing.
Currency Wars... Started about the time I joined ZH.
Everyone is printing, just different rates at different times. We the people, as it were, are on an express elevator to hell.
Regards,
Cooter
Thanks Cooter. Sounds True.
and the Crimex or whoever is running the show have driven "paper" PM's down to lows we haven't seen in 4 years!
I gotta say it over and over again...it's fucked up, but hey...gotta give some mad props to these fucking criminal scumbags who have the ability to do what they do to keep giving us cheaper and cheaper phyzz PM's!!!
I don't know about the rest of you all...but I'll keep taking these dips day afer day, week after week, month and fucking month for as long as they can dish it out, bitchez!!!
Yeah, I hope they eventually burn in hell or are at least thrown in prison for decades. But until this who fucking thing hits the fan, we have to keep taking these gifts of historically low PM prices like our lives depend on it. And...ummmm...they pretty much do, kiddo's. These are our last fucking chances...so let's not go to sleep on it and lose out.
Keep stacking the phyzz...budget into it little by little as these fuck-bags keep jamming the paper prices down. Don't go all in...just grab whatever fits into your budget. 10-20-30-40-50-100-a monster box....whatever you buy that doesn't take food out of you and your family's mouths, etc.
I'm a 10oz to 50oz type buyer...being truthful. Since the beginning of July I've been riding this downward trend channel once a week and scooping up cheaper and cheaper phyzz the best I can. To each their own. Just do it!
Ya gotta keep in mind that with all we buy and the lower it goes week after week we're not "losing" anything at all. We're just lowering our cost average and gaining more stacks of phyzz as we should be in order to prepare to the end of this whole shit system. We're winning, kids...don't ever doubt it for one bit.
Just keep stacking as you can while also stacking food, water, ammo, guns, and other essential gear. Budget it out...spread it out...prioritize as you go and find those deals in every category of gear that you need and get it now.
Could they hammer paper prices down to 10 and 750???? of course they could! They only have to type it in on a keyboard. Good! It doesn't mean you've lost any "money"....it means we just hopefully have more chances to stack more cheap phyzz.
That's why they're doing this...so that they can stack cheap phyzz. So we need to go along with it and stack along with them at our own pace as it fits our budget. Just do it!
Once all the phyzz is gone and the criminal paper game has collapsed we're going to be on a rocket ride to the stratosphere that literally 95% of the rest of the people we've been trying to wake up over the past many years aren't going to be able to take part in. Sucks for them, but we know how hard we've tried, right??? We've tried so fucking hard to wake others up with only very little success.
Well...that's just how it goes, so we have to keep on doing this for as long as we can. When this all turns around it's going to be un-fucking believable. The biggest gain of wealth in the history of the world.
Or to put it another way in lesser terms...the best way in the history of the world to at least preserve our wealth and purchasing power so that we don't become completely destitute and end up dead. Think of it that way and just keep stackin' bitchez!!!
Happy All Hallow's Eve...have a killer weekend. Let's hope we get a 15 handle on silver come Monday so we can scoop up more cheap phyzz before supply disappears and premiums skyrocket.
Oh...and in case ya didn't know about this and didn't see my other post earlier. Here's a killer of a deal on the most kick ass silver rounds you've ever seen. So don't say I never did nothin' for ya!!!
http://www.blog.providentmetals.com/promotions/when-josh-wins-you-win-silver-sale.htm
Don't spend all your money on candy and drinks this weekend. We've been given another killer gift from the criminal Cartel. Take advantage, bitchez. You know what to do!!!
Cheers and Beers, bitchez! And keep stackin' the phyzz!!!! GDamn, I love that shiny phyzz!!!!
It's so crazy that it might work. ...like 20% to 200% CPI?
Nothing but CB tag-teams. Fed gets worn out and tags the ECB, who is in for about 8 seconds and tags over to BOJ, who is in for about 4 days and back to the Fed. Every once in a while the BOE or some other evil piece of shit secont tier bank heads towards the ropes but retreats at the last second. All BS.
I'm going out to score more free candy for the bomb shelter.
They export some pretty sweet sportbikes
What's worse is that they are still the best in a very bad neighborhood.
Everybody knows you never go full retard
As long as the people trade their lives for fiat..they will print it.
Independence!!
RIPS
i just read some dumbfucks here writing:
haha hammered PM i buy gold a lot
- where you buy i can't find any !?
- on www.xxxxx..... with lil extra they keep it ...
so... you have on ZH some guys thinking they are smarter than average, thinking they got the situation handled well, and still think when they buy gold that it is physical gold, but they just got paper.
even less, an e-mail.
i stoped talking about PM with americans, they will never get it, too much TV ruined their logical sense.
one single proof, when i say "how you cook PM" they downvote me... as if any non eatable product was valuable on longterm shtf...
very basic is not gold, weapon, basic is water>food>heat. period.
pm buyers here are as pityfull as banksters. they buy the dip to sell on high... sad parts is they spit on the shared soup.
no one as the courage to confess my says, from this point how the fuck you want this country to go riot against .GOV... lol
You mean you can't find any in a shop for CASH sale?
Seems like you can buy on the Internet no problem for 10 OZ or so... but you have to pay a premium on the Spot price.
Maybe you just don't want to pay any premium on spot?
Sorry I just read your late addition.
I hear you. People just can't think. And people that play gold might be here on ZH working their hips and boobs for the juice.
Today I am thinking... Gold might go to 1100 as the industry has worked back and forth to scare people that prices are first going down, no now they are going up-buy now-buy now-, no they are dipping-buy now-buy now.
I agree with your sentiment, but for one small point. If you've been to the US and don't think a weapon is as basic as food and water, I don't know what to tell you. You won't get to hold onto your food and water long enough to eat and drink it. Hell, that's already true in many parts of the US, and we're only in the first inning of this collapse.
Yeah, I looked at water as an investment few years back. apparently I don't know much about a lot of things...
California has big probs, Las Vegas, New Mexico, Arizona, Utah, Colorado. Lots of land is not good for cattle or agriculture.
You know smart people, engineers, military, professionals often opine that...
- the people don't know how to run the country,
- that they are not educated enough,
- that they don't read the newspaper enough,
- that they don't follow politics,
- that they are unqualified to Vote,
- THAT they will believe ANYTHING
This is sort of a kind of Elitist thinking, but it does have logic to it.
nope-1004; Actually I'm afraid of what the alternatives could be. I ain't in the stock market and only have a small cheap house to downsize from.
- Glabal Kurancy like SDR
- 2nd USD for international trade
- Gold Standard (where 97% of US consumers have no gold
- End of US Social Security
- Bail-Ins from all US Savings & Checking Accounts & Brokerage Accounts
- NIRP
- New Round of Bailouts to TBTF and all Commercial Banks OR for Reducing Federal Debt
Hah
Ju-on 2 in the making?
jb
I didn't realize 70s songwriter Paul Williams is now a brunette.
http://photos1.blogger.com/blogger/45/1378/1600/Phantom5.jpg
Not that destroying the currency is ever a good idea,
but when you import most of your energy, food, and raw materials, it is aggressively stupid.
Maybe it diverts attention from Fukushima.
Russian roulette is safer than this idiots
Stick a fork in it... This roadkill isn't fit for consumption.
" In fact, this was just the beginning of a Ponzi scheme so vast that in a matter of seconds its ignited the Japanese stock averages by 5%. And here’s the reason: Japan Inc. is fixing to inject a massive bid into the stock market based on a monumental emission of central bank credit created out of thin air. So doing, it has generated the greatest front-running frenzy ever recorded."
To watch stocks soar again, based on Central Bank Liquidity and Bond Buying going to infinity? BOJ has admitted by their actions that something is terribly worng with their entire government and private sector financial structures. They have caved in to unlimited printing and 100% bond purchases. Imagine what figures and analysis they were presented with to push them over the edge! Central Banks are nearing the end of their abilites to continue to keep banks and stock markets in boom territory.
I watch stocks soar today, and the MSM said it was based on very strong US ecnomic growth. I them vomited in the toilet. There simply is no end to how far the Central Banks will go, they may have no choice. Europe is heading for a Japan like moment. "Printing: Everything it takes". The USA, the world's present Golden Boy of growth and prosperity. Or so I am told.
Stocks respond to an open guarantee of stock values by world central banks. That trade is the only trade, when Government and Central Banks come to you and say, "if you are long stocks, we are going to guarantee those prices continue to soar." That is why buying frenzy again has broken out. Nobody wants to miss free Fed money.
"Imagine what figures and analysis they were presented with to push them over the edge!"
That statement assumes the BoJ acted alone and without US complicity. I maintain that the US is doing this as a way to continue buying US paper through Japan. They are all ponzi's acting together.
naked theft. they are just trying to pump and dump the nikkei. this has to be the worst time in the world to buy stocks and to announce it to the world ahead of time on top of that is pure criminality.
I wonder who they announced it to before they announced it publicly.
Everybody got people, you should know that by now.
Question to fellow ZHers - I would like to start building a position in gold through bullionvault. Does anyone use thier service and can we trust them during the great reset.
I don't want to keep the gold in US and I'm planning to store it in singapore vault. Suggestions please.
I suggest the following...
if u cant put your hands on your physical in 1 second then it aint safe...
even outside the US financial system...
remember - If u aint holding it...it aint YOURS...
no one in my opinion should be trusted with your real money moving forward...
COUNTER PARTY RISK IS A MOTHER FUCKER.
Well my neighborhood is better than I thought 6 years ago, but this is a poor neighborhood. BYOS
Bring your own security, which is not always perfect or practical.
Nice that neighbors are all nice. But I think taking chances with traceable transactions and official boxes or storage containers has to work for the average guy.
Perfectionist won't like it.
I suggest you ask an expert like Koos Jansen of BullionStar.com He is the most informed person on the SGE. By far. You can follow him on @KoosJansen. He really is a no shit guy as far as I can tell in the time I have been following his work. He is extremely well-regarded by writers like Jim Rickards, Willem Middelkoop, John Butler - all names on gold in their own right.
Here is the problem. Even if the owners of bullionvault and other companies are the most honest human beings ever born, they WILL comply with every government order, and they WILL hand over your assets when demanded.
The ONLY gold (or other assets) that are safe are those that you yourself hide with great care, and tell NOBODY about. And that's a fact.
Not saying Singapore isn't a lot safer than NewYork, but there is no safety when ANY priciple or ANY corporation or ANY associated entity is within the fictional jurisdiction of the USSA, EU, Canada, Australia, or any "well organized" country.
Funny real. If you become known as down on your luck, a criminal, broke or poor, or are a deposed leader...
- Banks & Lawyers will turn against you
- You can eve lose your money in Asia or Latin America or France
Funny how that works. You have to have money and be able to fight.
Thanks for your suggestions folks. Other option I have is to buy physical, pay duty in my home country and store it there.
I opened an a/c with them in 2010 after spending about a month doing due dilligence....you are definitely buying physical gold...you can have your own bars "allocated" also.....(in other words they are retired in your name)....I do not have any gold with them currently but when I sold my gold in 2012 all funds appeared in my a/c within 2 days. I think they use Lloyds TSB for banking...I'm domicile in the UK but bought gold stored in Zurich....For me the issue was less about actual legal ownership of the gold (you have that)..it's a custodial issue...once you pay for something you generally want to be in possession of it. My experience was fine, but in the back of my mind I always felt uneasy about the fact that i didn't have "physical" ownership and was therefore always exposed in some way to the possibility of a Man Financial like fraud....These fears are only ever tested out during an actual crisis and in the end I simply didn't want to take the chance of becoming a "creditor" at exactly the point in time when i needed the physical in my possession. So i sold up and went to Switzerland and bought/stored the bars myself. Slightly more expensive process..but I sleep better ;-) As a US citizen I would advise you to look at Panama possibly if you end up going down the possession/storage route. Bullion vault is a good, reputable company...but just remember this...What is the economic system going to look like at exactly the time when you might really need your gold....
Question: Is gold in EU more expensive to hold or store and to buy. Seems like Swiss gold is more expensive. If you use USD then Switzerland would be an expensive country, so the fees would be higher.
Really would guess that Panama would be better way to go, but don't know anything about Panama banking or storage.
Panama is known for setting up businesses and for banking.
Guessing if you have Swiss gold or American Gold with an Assay that you can get fair value and convert gold to cash of your choice in South America, Central America, Caribbean or wherever.
If you are paranoid, just note that Singapore is host to the US naval base in SE Asia. If you are not paranoid, why bother to keep it so far away from your physical access.
..
It gets interesting from here on in. This the last act of desperation by Kuroda and Co., one last Hail Mary.
I seriously doubt Korea and China Inc. will stand idly by while Japan undercuts them in a currency war.
And my guess is the Fed's fingerprints or fore knowledge of this move were certainly coordinated.
Japan is beyond hope. The Fed is using them as a last ditch effort to get the economies of the world going. How much longer can this BS last?
Maybe everyone dumped all those derivatives on Japan and doing this is a last ditch effort before they explode like ten thousand A bombs.
Its a perfect country to implode because their people will just bow and eat their rice bowls quietly
Following this string. Japan & South Korea tie their currency to USD.
Now we see China is one of the biggest holders of US Long Term Treasuries if not the biggest.
- So it follows that Japan, South Korea & China are all now tied to the USD
- What does it mean if China is hugely in Debt & Japan is Printing huge amounts of Yen? US & EU are also hugely in debt
- He who prints longest & first wins? Japan is not winning as 99% are losing
- He that is an Elite, who controls the printing, Wins Last
A collapsing Japan buys the US exactly how much time, I wonder?
Why would it be the last? They've been doing this for 25 years. They'll keep doing this until the "markets" force them to stop either via inflation (they're targeting 2%, and will be surprised when they get 20% instead) or inflation and credit risk overtake other factors in government bond prices. With low velocites of money there's no reason this can't go on for years or decades more. It will likely continue till entitlement payments become so large they blow up government budgets, and the central-bank-prints-to-cover-budget-deficits strategy is laid bare. That probably won't happen till the early 2020's.
Till then, a bottle of you're finest champagne and a market order for 10 million shares of SPY please.
This is Friday. China has a couple of days to come up with a response. The markets could be in for interesting times come Monday.
"Economic Theory is, at its very core, quackery; a fraud, a failed religion which refuses the established scrutiny of scientific procedure; an unholy can-of-worms where theory after theory is presented as magical mathematics; where under analysis, unfolds as mere unfounded opinions which normally and typically contradict the opinions (Theories) upon which they rest; suppositions, speculations, assumptions, pretense, confusion, misrepresentations; If economics were put to the scientific process it would be thrown out in disgust. Economics is nought but a discordant cacophony of ill-founded opinion!" pjb
http://verbewarp.blogspot.com/2011/08/delusional-economics.html
.
Talking Heads - Psycho Killer
http://www.youtube.com/watch?v=O52jAYa4Pm8
.
So I guess Japan will be buying our dips.....and not in the overnight market
Dang, I was hoping to buy a Japanese elder care robot for the rest of my old age. One with boobs and perky nipples. I know its orgasm would be fake but at my age and ugly I'm not that fussy.
Can't wait till people wake up and say, "Hey, wait a minute, we are trading valuable income producing assets like stocks away for paper that's being printed out of thin air and earns nothing? The government is buying up the valuable assets out from underneath us and we're getting nothing of real value in return other than depreciating paper? Taken to the extreme, the government will end up owning all the businesses and we will work for them and have to be managed by them when it has already become very clear that they can't even manage their own finances? "
It's over for them now. It's just a matter of time. The population is shrinking and the debt per capita will start to rise astronomically. The market may skyrocket in the local currency terms like Argentina has, but the currency will be destroyed. Rising energy costs will kill real economy.
Even Keynes would look at this and say what the fuck? I told you guys to save money during good times to spend during bad to even out the cycle. I didn't tell you to just keep printing money and spending it like idiots. Stop putting my name on the stupid freaking policy.
Funny thing, Sheriff Taylor is dealing with Gypsies.
They sell Fake Gold, Fake Stories, Fake Ceremonies, Fake Personal Finance Predictions for Guber.
Poor Aunt Bee & Ms. Crabtree bought the same ancient gold earrings.
Guber paid $3 for his Fortune.
Now we see the same Spiel in USA, US Federal Reserve, US Godman Sachs Testimony, and in TBTF TARP Bailout.
What is next?
- QE4
- NIRP
- New TARP
- Sell Social Security Funds to Private Banking
- Sell Municipal Pension Funds to Private Pirates
- Sack University Trust Funds
- Start a World War to Enrich DoD Contractors
- Crash Commodities for Inflated & Rapacious Profits
- Drop an Epidemic on the USA for Outsized Profits
I am TeethVillage88s and I stand behind this advertisement.
Operation Gypsy on Hogans Heroes. Fits Perfect. About NSA Spying on populous. Corporal Lebou says he is Psychic as he was hit by Lightning.
Slight correction, in the first paragraph, it quotes the number $750 billion. Haven't seen a JPY/USD exchange rate like that in a while. $80 trillion JPY is over $800 billion USD for a while now. Even more outrageous when you consider it.
Sigh. Yen is DEPRECIATING (big word, I will translate for you, it means it is becoming worth less). So why would 80trn JPY go from 750bn USD to over 800bn USD? Yen buys less dollars, you need more yen to buy a dollar...
80trn JPY / 112 USDJPY = 714bn USD
Dumb. Uh well maybe Kuroda thought the same as you and no one pointed it out to him yet... Might be an explanation...
But that's not government funding by the printing press, right?
According to Natixis FICC Research:
http://personal.crocodoc.com/SU8Hy8u
In reality, central banks control only the prices of the assets they buy directly
When a central bank buys an asset directly (often government bonds), it drives up the price of this asset, the demand for which increases.
But the prices of the other asset classes increase only if the economic agents that have sold the first assets to the central bank use the money received to buy these other asset classes.
This transmission of increases in asset prices to all asset classes is therefore unstable, since it depends on the behaviour of investors and savers. Since 2012, we have seen that central banks’ purchases first led asset sellers to buy risky assets (equities, corporate bonds), whose prices rose. But in the recent period, the rise in risk aversion has turned them away from risky assets, whose prices have fallen, and they have invested the money received from the central bank in risk-free assets.
There is therefore no stable monetary policy "risk channel"; the only asset prices that are controlled by central banks in the longer run are those of the assets that central banks buy directly. This could in the future push central banks to buy riskier assets if they want to change their prices in a stable manner.
Central banks’ asset purchases have a direct impact on the prices of these assets
When a central bank buys financial assets, it increases demand for these assets, which directly drives up their prices.
This occurred with purchases of Treasuries and ABS in the United States (Charts 1A and B) and with government bonds in the United Kingdom and Japan (Charts 2A and B), and with the announcement of covered bond purchases in the euro zone (Chart 3).
But the impact of the central bank’s asset purchases on other asset classes is uncertain
- The central bank buys assets (especially government bonds, Charts 1A, 2A and B above).
- It pays by creating money (Chart 4).
- The economic agents that sell assets to the central bank use this money to buy other assets. But they have a free choice: a quantitative easing policy will drive up the prices of the assets that economic agents choose to buy, not the prices of the others.
- We also saw from 2011-2012 until the spring of 2014:
• A tightening of credit spreads (Charts 5A and B, 6A and B);
• A rise in the stock market (Charts 7A and B, 8A and B).
- But investors’ risk aversion has risen since the spring of 2014, (Charts 9A and B): they no longer buy risky assets and the prices of these assets have corrected downwards, whereas long-term interest rates on risk-free government bonds have fallen sharply (Chart 3 above, Charts 10A and B).
Conclusion: The risk channel is not robust
The transmission of the rise in the prices of the assets the central bank buys directly to a rise in the prices of other assets is therefore unstable, since it depends on investors’ attitude and their risk aversion.
The "risk channel" is the mechanism through which the central bank’s monetary creation drives down risk premia.
We have seen that this mechanism is unstable: it functions only if economic agents use the money created by the central bank, in exchange for purchases of risk-free assets, to buy risky assets.
If their risk aversion rises, this mechanism disappears - and so does the risk channel. In that case, the only remaining possibility for the central bank is to buy risky assets directly if it wants to drive down their prices.
When is the last time Natixis completed a full audit of all Central Bank transactions to know anything about what central banks do or do not do?
" Its pure Keynesian mythology"
Its pure Keynesian conspircy. There fixed it for you.
You could even say that it is conspiracy to murder 2 million mid-easterners; conspiracy to commit human atrocities; conspiracy to move the wealth from populations of the world into a few controlling hands; conspiracy to create what Putin has called the New World Order.
Banksters - the lowest scum to slither arcross the face of the planet.
I like them buying me time to enjoy life and
prepare for hellzacomin.
But the ensuing struggle won't be for old guys.
So don't wait TOO long.
It is painfully clear to me that they are intentionally destroying the productive economy so only the least productive can survive. The finacialists are doing better than ever, anyone intending to produce a physical good for profit is being pounded into the pavement.
It is barely profitable to distribute goods, yet incredibly profitable to play the Wall Street game. A college friend of mine just had his company bought by Google, which was probably the VC plan all along. They produced a physical product, programmed, and distributed it. Never making a dime off it. The company was bought and the entire product line was canned. Every unit of inventory is now worthless and anyone that bought the product now has a $500 paper weight. Nobody at the company cares because their big payday just came in. The financial media is writing it as a huge success.
Fucking your customer base is now a great business play.
The Japanese company I worked for is closing at thend of this year. It is no longer possible to turn a profit as a private company. The Yen shenanigans wrecked their balance sheet. So 50 people in the US and 500 in Japan will no longer have jobs. A $250 million company in real sales to zero in two years.
What amazes me is how much Wall Street distorts the economy. A publicly traded retailer must increase sales, even in a declining environment, so they keep forcing margin expansion on suppliers while the government keeps pushing new regulations that make it harder to make any money. The retailer doesn't care what they do to vendors or that what customers receive is total shit as long as the resulting number increases their stock valuation.
By new mandated regulations my new company must test and toss 30% of the inventory of one of our products, thanks to California regulations. A mass retailer gets to make $35 off the sale of one product, we make $4.50. If the retailer would take $1 less we could manufacture a far better product, but as it stands now we have to cut everything we can and cheapen materials. Sooner or later it won't even be worth producing the product.
I found out that one of our publicly traded competitors can sell a product for less than we can because they use unsafe reground plastic. We could do the same but don't have an army of lawyers to protect us when the inevitable failure occurs.
The real economy is dead and isn't coming back.
wretched info, but great post. you are correct. this isnt stupidity or ignorance, or even just simple greed. this is planned, executed, destruction.
This info seems to show that high Executive Pay at the Retail Level, and high overhead at the Retail Level is... predatory.
Sound off if you this otherwise:
"A mass retailer gets to make $35 off the sale of one product, we make $4.50."
WTF $30.5 / $4.50 is 677% mark up.
If you think Government is the problem, you have your head in your Fascist Ass. Yes, the financial side is messing everything up, but also it is the executives and those taking the juice.
The real economy cannot be dead, it just has to go underground. It is just that the US and EC small biz have no experience in operating in underground economies that are aplenty in the EM countries.
The undeground economy not in vices is the salvation to the alternative of mass violence.
http://i0.kym-cdn.com/photos/images/facebook/000/005/309/doitus4.jpg
Start -> Debt -> Unsustainable debt -> Hidden monetization of debt by artificial tweaks to the rate of interest and similar -> Outright monetization of debt -> War and/or Collapse
Japan was snookered in 2000.
The fact that Japan has managed to last on life support for 14 more years is remarkable.
There is no way out for Japan. It will never get out of where it is at.
The problem now is that Japan is big enough to drag other regions in to where Japan now finds herself.
"The scheme is so insane that the surge of markets around the world in response to the BOJ’s announcement is proof positive that the mother of all central bank bubbles now envelopes the entire globe."
Thank you for that Mr. Stockman, it helps to know that the insanity is seen by others.
Perhaps japan will be the black swan event...would be fitting...exploded in WW2 then imploded in 2015-2016. wait for it...
Well, this is one way to repopulate the countryside.
Why doesnt the BOJ just list what ETF's they plan to buy for the given month, this way EVERYONE can get in on the action.Same goes for equities purchased in the world markets.
What a perfect way for the GVT to apply its keynesian policy. The gvt gets to collect taxes on the profits and the individual gets access to the freshly printed money...
I should get nominated for the nobel price in economics or something
I told you that radioactivity from Fukupshima would soon have all of Japan going indane. I was right.
Their Govt News Channel announced that they're planning to vest more into (Foreign) Individual Stocks as well, so while the Nikkei Boost takes it to a 7-Year High, Stock Indices abroad may see a spike when the word leaks out to TEAM_JPN's BOJ and Govt/Pension Funds' buying binge.
They did pump up the USD, which may favor Large Exporters; but it seems so short sighted to me.
Japs are crazier than a pet coon under a red wagon. https://www.youtube.com/watch?v=xc7ODIzSa6E
A great pile-up in the days ahead with Asian equities (ex Japan/China) already with low liquidity atop of rickety legal regimes and market structures.
Juices from their volatility much better than their currencies/soverign bonds.
Great piece that reiterates price discovery has collapsed and more so in Asia EM nations markets.
Insanity: doing the same thing over and over again and expecting different results.
Albert Einstein
Perhaps the term henceforth should be "central pranksters"
Kuroda's move is strictly temporary and directed at US elections.
I would wager that the US Fed will not be far behind Japan's "surprise". ... which really was no surprise at all in hindsight.
well for anyone still guessing at the BIS's end game, the boj has just shown you, if you didn't catch it in america the last six years.
whats the word you've heard for decades for smart investing for the average joe, DIVERSAFICATION.
whats the BIS forcing the worlds population into, 100% equities, while they buy their own bonds, (your obligated debt), cheap.
along comes our next 2008, 40%-70% loss in equities, middle-class financial assets, (their financial freedom), is gone.
check, and mate, you've just been nationalized, nwo'ed, globalized, you've lost your financial assets, (financial freedom), but your obligations to the BIS's gazillion dollars of fed. gb, ecb, boj bonds they've bought are still due.
there will be no QE's, or bail-outs coming, to the winner comes the spoils, BIS will loan co.'s money to keep them running, which ones will be at their discression, with advise from the epa.
whos going to default, the BIS isn't going to default, they'll be nice and take payments, either in your blood, (ww111), to further their ideoligy, or a wiemar style repossesion.
putin can see this coming, 2,000,000,000 ameicans, british, europeans, and japense sheep looking to find somewhere else to graze, and looking for someone to tell them where it's at.
just as hitler found in germany, poor, angry citizens.