Take the back seat, FED: Bank of Japan to Double Monetary Supply in 2 Years!

[MRK]

http://www.reuters.com/article/2013/04/04/us-japan-economy-boj-idUSBRE93216U20130404


The Bank of Japan unleashed the world's most intense burst of monetary stimulus on Thursday, promising to inject about $1.4 trillion into the economy in less than two years, a radical gamble that sent the yen reeling and bond yields to record lows.

New Governor Haruhiko Kuroda committed the BOJ to open-ended asset buying and said the monetary base would nearly double to 270 trillion yen ($2.9 trillion) by the end of 2014 in a shock therapy to end two decades of stagnation.

[MRK]

Although assuming the FED injects $75 billion per month, over two years it is still injecting more in at about $1.8 trillion versus BOJ's planned $1.4 trillion equivalent. But the real problem here is they're doubling the currency base! I wouldn't believe it unless I knew that many in Japan have been itching to inflate for decades now ever since their last big QE.

[VIDEODROME]

Now that's the real FEDZILLA.

[Bern]

http://www.youtube.com/watch?v=qcDztfFXPww

[jclay2]

http://www.youtube.com/watch?v=qcDztfFXPww

lol

[jbauer]

The problem with this is now we'll need to double down. One of the reasons we keep printing money is to keep our trade balance with them. One of the big reasons the EU has had problems is they've been reluctant to mega print.

I imagine this means QE Infinity in the USA just bought itself another year or two.....assuming they have any intention of stoping.

[WM_in_MO]

http://www.youtube.com/watch?v=qcDztfFXPww
He's gonna need a bigger chopper:

https://www.youtube.com/watch?v=HBd6ighzqYA

[Bern]

...
I imagine this means QE Infinity in the USA just bought itself another year or two.....assuming they have any intention of stoping.

AEP acknowledges "QE to infinity" (TM Jim Sinclair):
Readers of the Daily Telegraph were right all along. Quantitative easing will never be reversed. It is not liquidity management as claimed so vehemently at the outset. It really is the same as printing money.

Columbia Professor Michael Woodford, the world's most closely followed monetary theorist, says it is time to come clean and state openly that bond purchases are forever, and the sooner people understand this the better.

"All this talk of exit strategies is deeply negative," he told a London Business School seminar on the merits of helicopter money, or "overt monetary financing."

He said the Bank of Japan made the mistake of reversing all its money creation from 2001 to 2006 once it thought the economy was safely out of the woods. But Japan crashed back into deeper deflation as soon the Lehman crisis hit.

"If we are going to scare the horses, let's scare them properly. Let's go further and eliminate government debt on the bloated balance sheet of central banks," he said. This could done with a flick of the fingers. The debt would vanish.

Lord Turner, head of the now defunct Financial Services Authority, made the point more delicately. "We must tell people that, if necessary, QE will turn out to be permanent."

The write-off should cover "previous fiscal deficits," the stock of public debt. It should be "post-facto monetary finance."

The policy is elastic, for Lord Turner went on to argue that central banks in the US, Japan, and Europe should stand ready to finance current spending as well, if push comes to shove. At least the money would go straight into the veins of the economy rather than leaking out into asset bubbles.

Today's QE relies on pushing down borrowing costs. It is "creditism." That is a very blunt tool in a deleveraging bust when nobody wants to borrow.

Lord Turner says the current policy has become dangerous, yielding ever-less returns, with ever-worsening side-effects. It would be better for central banks to put the money into railways, bridges, clean energy, smart grids, or whatever does most to regenerate the economy.

The policy can be "wrapped" in such a way as to preserve central bank independence. The Fed or the Bank of England would decide when enough is enough, or what the proper pace should be, just as they calibrate every tool. That at least is the argument. I merely report it.

Lord Turner knows this breaks the ultimate taboo, and that taboos evolve for sound anthropological reasons, but he invokes the doctrine of the lesser evil. "The danger in this environment is that if we deny ourselves this option, people will find other ways of dealing with deflation, and that would be worse."

A breakdown of the global trading system might be one, armed conquest or Fascism may be others -- or all together, as in the 1930s.
...
If Lord Turner's helicopters are ever needed, we can be sure that the Anglo-Saxons and the Japanese will steal a march while Europe will be the last to move. The European Central Bank will resist monetary financing of deficits until the bitter end, knowing that such action risks destroying German political consent for the euro project.

By holding the line on orthodoxy, the ECB will guarantee that Euroland continues to suffer the deepest depression. Once the dirty game begins, you stand aside at your peril.

A great many readers in Britain and the US will be horrified that this helicopter debate is taking place at all, as if the QE virus is mutating into ever-more deadly strains.

Bondholders across the world may suspect that Britain, the US, and other deadbeat states are engineering a stealth default on sovereign debts, and they may be right in a sense. But they are warned. This is the next shoe to drop in the temples of central banking.

More: http://www.telegraph.co.uk/finance/comment/ambroseevans_pritchard/9970294/Helicopter-QE-will-never-be-reversed.html

[roho76]

This could done with a flick of the fingers. The debt would vanish.

Oh, how neat. So just the click of a finger and all the debt is gone. How cool is that guys? I'm going to call all my creditors and flick my fingers over the phone and say "have a nice day, good doing business with you." I love progress.

[VIDEODROME]

and which finger are they flicking at all of us?

[BAllen]

Oh, how neat. So just the click of a finger and all the debt is gone. How cool is that guys? I'm going to call all my creditors and flick my fingers over the phone and say "have a nice day, good doing business with you." I love progress.

Actually, that makes sense. Money is created out of nothing anyway, so what difference does it make if you erase the debt figures? You can always create more money through loans.

[cbc58]

Actually, that makes sense. Money is created out of nothing anyway, so what difference does it make if you erase the debt figures? You can always create more money through loans.

you're joking... right?

[Tod]

Rogers recently said the Yen would be the first to collapse. In 2009 he was saying that he was buying yen rather than euros.

[jbauer]

Actually, that makes sense. Money is created out of nothing anyway, so what difference does it make if you erase the debt figures? You can always create more money through loans.

Interesting paradox where money is created out of thin air but the things purchased with it isn't. No issues here America, just make sure when you bend over that you lube up real well because you're going to need it when it all fails.

[BAllen]

you're joking... right?

I'm quite serious. What difference does it make?

[HOLLYWOOD]

TAX the shit out of the serfs! FIAT INFLATION is the hidden game of stealing wealth and redistributing it to the insiders and of course partner government.

Don't forget the apathetic poorer victims will be zombies by the follow-up sequel...

http://books.energion.com/images/lie_with_statistics.jpg


(Same shit, different Central Bank branch)

[cbc58]

I'm quite serious. What difference does it make?

this:


Interesting paradox where money is created out of thin air but the things purchased with it isn't.

you can't possibly believe you can chase down all the money created, wipe out all of the flow and transaction history and eliminate it's effect simply by cancelling out the debt... can you?

[torchbearer]

this should fix everything.

[BAllen]

this:



you can't possibly believe you can chase down all the money created, wipe out all of the flow and transaction history and eliminate it's effect simply by cancelling out the debt... can you?

Why not? Times are different. Market competition keeps pricing in check.

[The Gold Standard]

you can't possibly believe you can chase down all the money created, wipe out all of the flow and transaction history and eliminate it's effect simply by cancelling out the debt... can you?

You are wasting your time. He thinks printing money creates wealth, and the brown skinned animals are the worst of the problems we face.

[cbc58]

Why not? Times are different. Market competition keeps pricing in check.

phew... glad you came up with the ideal solution for us. you should hop on the phone with the countries of the world that are on the brink of collapse so they don't have to endure what's going on -- or ever devalue. what are they thinking... it's so easy.

[BAllen]

phew... glad you came up with the ideal solution for us. you should hop on the phone with the countries of the world that are on the brink of collapse so they don't have to endure what's going on -- or ever devalue. what are they thinking... it's so easy.

And you should do some research:

http://wfhummel.cnchost.com/inflation.html