Bank of Japan Sprays World With Surprising ¥10 Trillion Gift In Valentine's Day Liquidity
In a move that will surely shock, shock, the monetary purists out there, the Bank of Japan has just gone and done what we predicted back in May 2011, with the first of our "Hyprintspeed" series articles: "A Look At The BOJ's Current, And Future, Quantitative Easing" (the second one which discussed the imminent advent of the ¥1 quadrillion in total debt threshold was also fulfilled three weeks ago). So just what did the BOJ do? Why nothing short of join the ECB, the BOE, and the Fed (and don't get us started on those crack FX traders at the SNB) in electronically printing even more 1 and 0-based monetary equivalents (full statement here). From WSJ: "The Bank of Japan surprised markets Tuesday by implementing new easing policies and moving closer to an explicit price target, the latest sign of growing worries around the world about the ripple effects of the European debt crisis on the global economy. With interest rates already close to zero, the BOJ has relied in recent months on asset purchases to stimulate the economy. In Tuesday's meeting, the central bank expanded that plan by ¥10 trillion, or about $130 billion. The facility, which includes low-cost loans, is now worth about ¥65 trillion, or $844 billion." The rub however lies in the total Japanese GDP, which at last check was $6 trillion (give or take), and declining. Which means this announcement was the functional equivalent to a surprise $325 billion QE announced by the Fed. What is ironic is the market reaction: the BOJ expands its LSAP by 18% and the USDJPY moves by 30 pips. As for gold, not a peep: as if the market has now priced in that the world's central banks will dilute themselves to death. Unfortunately, it is only at death, and the failure of all status quo fiat paper, that the real value of the yellow metal, whose metallic nature continues to be suppressed via paper pathways, will truly shine.
The WSJ explains the BOJ's stunning decision further:
Only one out of the 11 analysts polled by Dow Jones Newswires had predicted the BOJ to ease this week.
Most BOJ watchers had said that while there were concerns over the impact of the strong yen and the European debt crisis, neither financial nor economic conditions had worsened to levels that warranted immediate further action.
The BOJ policy board also revised the wording of its "understanding of price stability," saying now it has set a "price stability goal" of 2% or lower in the core consumer price index in the medium- to long-term and a goal of 1% growth for the time being. For calendar year 2011, Japan's core consumer price index—excluding food prices—was negative 0.3%.
The bank had come under criticism that its definition of price stability, the goal it seeks to achieve in its fight against deflation, was too convoluted and vague. Such attacks had increased in recent weeks after the U.S. Federal Reserve in late January adopted a more explicit price target.
Faced with a prolonged deflation, politicians have stepped up their calls on the BOJ to take fresh action, with some threatening to revise legislation to strip away the central bank's independence from the government.
First of all, don't get us started on inflation targeting. Or rather, get Dylan Grice started: he will tell you all about it, and then some.
And while we now really just can't wait to bring to our readers what the global central bank balance sheet will look like after February, when it takes into account the recent GBP50 billlion BOE expansion, the €500-€1000 billion European LTRO part Deux, and now the ¥10 trillion additional BOJ easing, here is what we said on the topic back in May of 2011.
"In a sign some in the BOJ were more cautious about the economic outlook than Shirakawa, Deputy Governor Kiyohiko Nishimura proposed on Thursday expanding the central bank's asset buying scheme by 5 trillion yen ($62 billion). While the proposal was outvoted by the board, some market players said it may be a sign the BOJ may loosen policy as early as next month. "And loosen it will, because unfortunately as the past 30 years have shown, the country at this point has no other choice but to take the same toxic medicine which merely removes the symptoms briefly, while making the underlying problems far worse. Also, with the Fed threatening to end QE2 in precisely two months, someone out there has to be dumping hundreds of billions in infinitely dilutable 1 and 0s into primary dealer prop desks. Furthermore, as shown above, the BOJ needs not to buy securities outright: tinkering with the shadow economy in the form of the repo market will provide just as desirable an outcome… If, of course, said outcome is to see gold and silver continue on their relentless rise to new all time record highs. And/or higher. Because the only thing limiting the price of gold is price stupidity and the amount of paper money in existence. Both are infinite.
It's good to see that our May 2011 quote on what the only realy gating factor on the price of gold is has now been broadly absorbed in the asset management vernacular. And yes, once the market does realize what is happening, following the usual 6-8 week uptake period, expect another step function higher in precious metals, CME margin hikes notwithstanding (and the recent CME faux margin cut bull trap aside).
Finally, unlike our own Fed, at least the BOJ is not shy telling the world it is openly buying up REITs and ETFs. For some odd reason our boys over at Liberty 33 are still playing so coy they can only punch their equity trade tickets via Citadel.
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meh, what's a few trillion here or there these days?
Fiat is a wash.
What Jerks. I mean, if they were just going to print that amount of money anyway, they could have saved us all the drama and simply purchased ALL of Greece's debt.
Now I have to decide which story is more worrisome. The story about that Russian Sub that was on fire with nukes loaded and minutes away from exploding and scrubing off a piece of Russia or this story. [LINK]
Thee whole worldwide monetary ponzi scheme is going to blow up in the most spectacular fashion, making that Russian Sub story look insignificant.
the big guys will eviscerate the markets after most of the dividends are paid out to the big investors. Then the "Big Short" will kick in...
btw: Kicking the Can is bullshit, it's no longer a fucking CAN! it's a CRATE, BARREL, PAPER BALL anything but a can!
We Better Break $5 Million Dollars Today! I Don't Give A Fuck!
http://www.ronpaulforums.com/showthread.php?360856-We-Better-Break-5-Million-Dollars-Today!-I-Don-t-Give-A-****!
I think the world just needs to go into a maintenance phase.
The planet doesn't need anymore growth.
The most influential device ever devised by man is and always will be the BIC Lighter, not the Apple I-Pod and facsimile. Nothing to get excited about there.
When the SHTF a Bic lighter will be very valuable.
The fiat just never stops until it commits suicide. QE to infinity is here. We will be forced back to the gold standard.
http://ronpaul2012blog.blogspot.com/
Shouldn't we just say that central banksters are the masters of the universe?
They ride unicorns and spit fireballs! Bow to the gods of finance, they are the all knowing and all dancing crap of the universe!
I congratulate the Jews. They Win.
If they would just change the word "Chemtrails" to "Chemical Trails", I'd bet they'd win their argument over night.
Why doesn't anybody make an epic motion picture of the Dot-Com bubble bust?
Why watch a movie when we can sit back and watch AAPL, NFLX, RIMM, GRPN, GOOG, PCLN and so many others discover gravity once again in real time as we sit back in disbelief as they head into orbit.
And, we can also watch the mother of all IPO's go STS-51-L with FaceBook (FB).
Only commodities and barbaric relics are in a bubble you know.
Banksters - "Masters of the Universe"? That would be He-Man or Skeletor, depending upon which one you ask.
http://upload.wikimedia.org/wikipedia/en/9/9e/Smeraldo.cc_motu_01.jpg
(although 85 Broad Street could be Castle Grayskull)
Bank of Japan Sprays World With Surprising ¥10 Trillion Gift In Valentine's Day Liquidity
Valentine’s Day, Spray, Liquid, Japan ……. There is a joke in there somewhere.
Fiat Bukkake
A reader's comments in response to a New York Times article on the situation in Greece (and soon to be the rest of PIIGS+France+U.K.) is purely epic, and I just wanted to share - but let me preface this by saying I'm very much Austrian School, and this reader's comments at least strongly suggest he may be not so inclined; so how incredible is it that he and I have arrived at exactly the same sentiments (with the exception of his 2nd sentence - see my comments after his indented quote in regards to this) on the whos [central fractional reserve bankster parasites] and the whats [enslaving nations] being done, and the instrumentality [debt] being used?:
Bill Appledorf
So, I agree with Bill Appledorf with the exception of his 2nd sentence.
Capitalism in its most primitive form, however, would not allow global fractional reserve banking syndicates to link up with wannabe monopolilistic or ogilopolistic businesses - only being able to do so through the Deep Capture of alleged 'elected' politicians/legislators and the so-called 'regulators' that they appoint, aka Crony Capitalism.
But capitalism is dwindling. It survives only in the beating hearts of those businesses still functioning and not on the teet of taxpayer dollars provided by Deeply Captured politicians and regulators, with the former folding by the day (especially in the form of what used to be the main driver of economic growth: small businesses).
He is absolutely correct that debt is being used to enslave nations and appropriate wealth of of those not in the Crony Class.
Plus One...
Appledork sounds a tad like those from TAE. A degree of facts that the reader can associate with to create credibility, but alignment, IMHO with an underlying 'marxism'.
"If only we planned or regulated better we could create a fairer and more just world" sounding like the "Alliance" from Serenity now LOL!
Anyway, f*ck all those "Chardonnay Socialist" and their f*ckin' banker funding bretheren....
Cool post FED.
BOJ nuclear option.
BOJ sprays world with money, eh?
Is that "fiat bukkake"?
A veritable bukkake of stock market hopes and dreams!
Ah, who will be next to spread their monetary joy juice throughout the world!?
interesting - http://hedge.ly/w2jeMt
"Bank of Japan SPRAYS World with Surprising 10 Trillion Yen Gift in Valentine's Day Liquidity"
Japanese Golden Shower
i ruv you
Holy F*******K
that shifts money flows big time, carry trade full on
London better have some plan to stop gold from spiking. I bet they do. I bet they flood the oceans with paper gold. Paper gold for all, bitchez! Paper gold for all!!!
Huge surge in paper-backed gold ETFs, for sure. Followed by margin hike at what, $1900? Double the size of the the most recent margin decrease, perhaps?
The only thing the PTB have going is that the status quo is still to live and die trying to get that paypa.
Please, PLEASE, let this be so....
I could then contemplate replacing what I lost in the boating accident and start again re-building what Granma left to me! On the other hand, that 60" LED, 3D, Social Media enabled TV, with no down and 5 years to pay, interest free, is pretty darn tempting (?)
I'm sorry for your loss. I too know of the pain of lost items via a boating accident.
And the next chapter of Currency Wars continues
It's the last chapter, hombre. The story ends in hyperinflation. Someone light a match, I dare ya.
yea right...save your matches...this book is infinite...futures up today, surprise, surprise... what a fucking joke
I was wondering about that spike. How long will it last? Two trading sessions? Way to go Shirakawa, you fucking idiot.
I think that post lunch nikkei spike timed with the greek midnight vote, this one is NOT priced in.
At this point the only thing not priced in is the AAPL.
central bank buying equilties? wow.
BoJ are experts at it.
Yep- screwing with currencies worked out SO well for Japan circa 1940........
Iceland Bitchez
long story short, It got fucked because of Government intervention, they said they they are ready to bail out the economy! They were heavly involved in carry trade and which created foreign currency mismatch (banks issued short-term liabilities in order to invest in long-term assets)
in 2007, after ten years of growth, the big three Icelandic banks, Kaupthing, Glitnir, and Landsbanki, owned assets in excess of 1100 percent of Iceland's GDP
Then Kratos came from Greece... reminds me of some graphix tyler posted a day ago..
Ara! Onara suru tsu-mori datta keh-do, un-chi ga de-chatta.
Shift the comma by one syllable to yield blood.
Ara! Onara suru tsumori datta kedo un, chi ga dechatta.
(I intended to fart but XshitX yeah, blood emerged.)
A spray in face like certain Japanese movies.
Juvenile. Sorry. I couldn't resist.
I guess this type of spraying activity encourages people to try smuggling gold into Japan in any possible way.
http://news.yahoo.com/skorea-men-arrested-smuggling-gold-rectums-092824419.html
Bukake Bitchezzz!!!!
also, 2% inflation target?? coordinated central bank inflation targetting, is a significant shift in Japanese monetary policy, suggests more YenQE on the way.....
...and Asia gets downgraded next, more so Japan.
anyways that is bearish for the market was in April and August 2011. Major USD meltups and Asia follows, stocks sell.
central banks are now governing bodies that do what they want at will. they are sending us towards the iceberg at warp speed
Funny how everyone ignores Japan. It's like Japan is the weird guy you work with that everyone jokes about how if he was fired he would go to work the next day firing a semi screaming this and that about respect.
lol
the one they really ignore is South America. I hear there's a whole continent down there...with a bunch of countries and shit
Not 265% in debt to gdp though. Instead they farm and fish and have fresh water.
respeck
this lowers chance of Japanese downgrade - Japan could inflate its way out of debt since so much is held domestically
and i dont see the japanese rioting on the streets due to wealth erosion
Like the US? Please...
In fact I am betting Japan gets looked upon very soon by a rating agency. See, they are stuck with the Obama disease, he needs to keep spending and raising debt. Problem is the value of bonds are sh*t. The US is junk right now and S&P will fire another shot this year. Bank on it.
Back to Japan. There is no revenue coming in, trade deficit that would make your eyes bleed that and Japan (like China) are net importers of energy = trade deficit forever and ever = a junk rating very soon.
And inflation will eat the rest of the economy up. Maybe, just maybe they become warriors again and chop off some well deserved heads.
Fingers crossed.
I have the same overall outlook re Japan, the YenQE improves its outlook, doesnt fix it
hey chump!
i need those heads for tsanta (head shrinking) in Ecuador
thnx.
I can not figure out why the Yen is "strong"...it seems to me with all of Japans debt...it should not be.....but what do I know about today economics...my econ 101 does not work anymore in a world of Central bankers
Gold is so manipulated it makes me puke. Fuck You's PPT.
London controls the POG.
WHO FUCKING JUNKED ME!?
LBMA controls the POG
Who the fuck do you think owns Barclays ishares/GLD/SLV???
The Rotheschildes
Have you been drinking tonight?
With the BoJ and ZH spraying so much junk tonight I didn't want to feel left out :/
Why the fuck would you want the price to go up? You can accumulate more if they keep it low. *head explode*
Stop!!! You can't be talking about the same Japan that has already lost 12 solid years in the game of kick the can? I guess we will call it a Whitney Houston, when you're soo far in why not go all the way? WTF, honestly, please Krugman, Summers and all the rest of you losers tell me how this will play out for my 12 year old son who gets straight A's and participates in all the local functions thinking he is making a difference? The NWO has no time for kids like my son and when they decide to pull the plug it will be like TFB for him... All I go to say is watch your back bitchez, the clock is ticking ...tick,tock,tick,tock,tick,tock, can you hear it yet?
Great Read! but please dont use Kick the "CAN"
Because it's no longer a fucking CAN!
Is that the sound of AmeriCANs running out into the street to stop the bankers, Of course not its the sound of a banker kicking a can down the road.
No, that's the sound of Americans jumping up and down watching their team win the superbowl. Americans only give a shit about sports, reality tv and beer. Oh and gay marriage. They could care less about anything else in large numbers. The 1/10th of the 1% gotta be laughing their asses off at us. What a joke we are.
better than a face full of jizz!
... or is it?
...what? them thar Shinto ''gods of Loyd'' need more human sacrifice? Well, were all due for another ''Title Wave'' kick in the Fannie. Lol. ...and the Whore of Babylon has another drink of wrath. http://www.youtube.com/watch?v=ySgOds3bzcc
http://bible.cc/revelation/14-8.htm
Golden Japanese Nix Nix Nix San say ''Sake to me'' http://www.youtube.com/watch?v=8qRZvlZZ0DY
Well, it seems that when the BoJ made the call it was followed by a 6.0 shallow quake 80 miles from the Fukushima meltdown. http://www.youtube.com/watch?v=7qHO6Lg16fE&feature=channel_video_title
Man, a 5.8 in Costa Rica, 5.6 in California, 6.0 in Fukushima and 6.5 in Solomon Islands. http://earthquake.usgs.gov/earthquakes/recenteqsww/Quakes/quakes_big.php
All this does is increase volatility. Thats al it does. The upsides and downsides will get greater until the Fiat Ponzi Tsunami is a wash.
thatd the implicit guarantee of the inflation target.
They wont flood the market with fiat forever, the flow will reverse once people finally buy back into rising asset prices, house prices, wages and the happily ever after feeling.
tsunami fiat flow is not on the agenda. it just looks like it now coz private sector and bank deleveraging is on such a roll.
Nobody will be buying fucking houses. Guess what happens next month? The housing market gets flooded with all the people that thought they would wait out the "dip" in housing. And as the banks flood the markets with foreclosures! Setting up QE mother fucking 18 (or whatever the fuck number we are on).
They won't flood the market with fiat forever. How long is forever? Forever-ever? Forever-ever??? What if forever already came and went? What if this is us dead and remembering life before a catastrphic event? How dense can you be not to question this world and its reality? Butterflys and teacups, sure, all of it.
which housing market you talking about, Japanese?
look at the BOJ asset purchase sheet - REITs
Also if you think fiat doesnt reverse, WTF happened in weimar republic?
And look at Q4 Fed balance sheet pre EUpocalypse... they had started to shrink it.
Of course that announcement is not made, for obvious reasons
Look at ECB, tightened in H1 2011.... despite its SMP.
If you think fiat ponzi is crashing, sorry mate its here to stay.
You know why? for the same reason that you are worried about hyperinflation and the collapse of the ponzi, coz the govts control the presses.
They turn them on and they turn them OFF. and when things get out of control on rare occassions, they PRINT a WHOLE NEW FIAT. simplez.
Well trebu, you make a good point. Many people thought the Ponzi was gonna cough up a lung in the late 70's, but thru some happy circumstance for the Ponzi Drivers, [North Sea/North Slope coming on line, largest creditor then, largest debtor now] Volker was able to pull out of the dive and get the Ponzi climbing again. I don't see the magic bullet arriving this time. The math dosen't support belief in magic salvation this time around for the Ponzi. If you look at this in terms of your life time, then yes, they've always been able to come up with, if not a stick-save, a sledge hammer, to get the Ponzi working again in times of Ponzi-crisis. But if you take a broader, historical perspective, the Ponzi always goes belly up.
If the crash is significant enough, people will, at first be reluctant to re-ignite a Ponzi. We may have a period of Neo-Enlightenment for decades ... before people forget, before none are left alive who remember
can't print oil
peak oil bitchez...it's what's for dinner
LH... they WILL flood the market forever, fundemental misunderstanding on your part...in a fiat world that is what they do....and as for the POG it WILL be the death of the market and not just "more buyers of paper gold than sellers of paper gold" that will bring in the new realization of gold's worth. The paper market can satisfy the needs of those who seek paper gold just as long as there is still paper....(longer actually...those who can be satisfied with 'ownership' short of actual possesion can be made happy with electrons.)
Somewhat disappointing ...
I had hoped BoJ would put a peg of 85 in place.
Perhaps they are saving that for March 11th?
That would be ironic and cold blooded at the same time - In memory of those who have and will die as a result of our national tragedy, please be silent while we firebomb the currency markets.
barliman
Japan can't hold a currencie peg, are you serious?
MLH,
While I understand the technical merits of your statement ... please approach my statement from a philosophical and cultural frame of reference. If the BoJ pegged the yen at 85.00/USD ...
... how would you describe their action in terms of their culture and using philosophical terms rather than financial?
Please note my reference to March 11th re: earthquake, tsunami & Fukushima; and then look forward into Japan's future if they continue on the same path they have been on, where they accept limitations and the certainty of future calamities and degradations.
barliman
P.S. See sizzurp's post below.
could be USD/JPY up coz of carry trade implications, since gold priced in $ gold going up too, for rest of world..... hence no immediate $AU spike.
Hyperinflate all the things!
The time of the snack is happy!
The Japanese have been busy creating a debt tower, and it looks like it just got bigger. I wonder how long before their currency goes into spontaneous combustion. We are about to get a first hand look at the end result of QE to infinity with Japan as the test case. Once the Yen gets bagged our own future will be unmasked, and it may launch an accelerated cascade out of all things paper. I think Kyle Bass is right. A sovereign debt crisis in Japan may be ultimate financial catatrophe that brings the whole fiat house crumbling down.
Japanese sovereign debt = japanase pension funds, YenQE just devalues the overall burden while paying fixed income in the future, helps to sort that problem out too...........
they need growth = exports = lower yen, yenqe good for that too