Since Ben Bernanke reminded the world of the existence of government printing-presses, echoed Milton Friedman's "helicopter drop" solution to fighting deflation, and decried Japan for not being as insane as it could be... it has only been a matter of time before some global central bank decided that the dropping of cash onto the populace was the key to economic recovery. Having blown their wad on QQE (and been left with a triple-dip recession), it appears Japan has reached that limit. As Japan's News47 reports [13], Prime Minister Shinzo Abe has instructed his cabinet to develop economic measures such as handing out 'gift certificates' to the poor to "support personal consumption directly."
[14]
As Japan's News47 reports (Via Google Translate), [13]
Following the negative growth of the gross domestic product of the July-September period (GDP), Prime Minister Shinzo Abe is to instruct the relevant ministries to develop new economic measures whereby income is handed out, such as gift certificates to the poor and to people building energy-saving housing, thought to support the personal consumption directly.
Abe also said mitigation measures for the energy price rise due to depreciation of the yen should be included.
Prime Minister in the express policy to dissolve the House of Representatives on the 18th, economic measures is expected to become the backbone of the ruling party commitment in the House of Representatives election.
The activation of consumption stimulus and regional economy and pillars, and founded the grants that local governments can use freely. Local governments to distribute the vouchers to people with low income.
Policy to revive the "housing eco-point" to grant the point in new construction and renovation of energy-saving housing.
* * *
As The Wall Street Journal adds, [15]
A surprise announcement early Monday that the economy contracted for a second straight quarter makes it “absolutely necessary to take countermeasures,” said Etsuro Honda, an architect of Mr. Abe’s economic policy
Koichi Hamada, another close economic adviser to Mr. Abe, said in an interview the central bank should act “without pulling any punches” if the economy continues to show weakness over the coming months. Mr. Hamada said he supported cash handouts to “those who are struggling” because of a higher sales tax and a weak yen.
* * *
So it's absolutely necessary to take countermeasures against the implications of the policies you instigated in the first place?
* * *
And so while some might liken it to EBT cards in the US... it appears this is simply a hidden way to directly hand out free money to those that spend and thus... increase inflation... So no need for firms to raise wages after all!??! Well played Abe.
h/t @L0gg0l and @Thoton
