Bank of Japan Adds More Stimulus to Fight Deflation, When No One Cares

Today’s increases were as follows:

• Japanese government bonds with coupons, about 39 trillion yen
• Treasury discount bills about 19.5 trillion yen
• Commercial paper about 2.2 trillion yen
• Corporate bonds about 3.2 trillion yen
• Beneficiary interest in index-linked exchange-traded funds about 2.1 trillion yen
• Investment equity issued by real estate investment corporations about 0.13 trillion yen.

Japan is aiming its fight at deflation. The bank said, “The Government and the Bank share the recognition that the critical challenge for Japan’s economy is to overcome deflation as early as possible and to return to a sustainable growth path with price stability.” It also said, “The Government strongly expects the Bank to continue powerful easing as outlined in section 2 until deflation is overcome.”

We already have looked around at the reactions to the easing. It seems that no one cares, and those that did care seemed to be disappointed, wanting more. The total came to about $138 billion or so. Unfortunately, $138 billion just is not quite what it used to be.

JON C. OGG