Monday, February 1, 2016

Japan QE has not helped the average Japanese family

In my view, (the Bank of Japan's) ammunition is not working. It worked in the sense that the stock market went up in the last 12-18 months but the yen has been going down.

If you're Japanese, eighteen months ago you had a certain net worth and now your currency is down 30 percent so are you richer or poorer? Of course you're poorer. These low interest rate in Japan, in my view, and especially now these negative interest rates, are rather more negative than positive for the economy and for the typical Japanese household.

Central intervention bank interventions

We all agree on one thing, that the market economy functions best because the opposite is socialism, communism and central planning, which has been a complete failure, but now democracies have implemented a system that is basically run by a bunch of professors and they target inflation, they target exchange rates, they target the quantity of money, I mean, is the world crazy to give them so much power?,

Their policies have been a complete failure over the last 20 years and now the same people are desperate because gradually their losing their prestige and credibility and they're doubling up on medicine that hasn't worked and it won't work as long as the central bankers that we have now are in power the economies in the world will go down and not recover,

I question the view that inflation is good and deflation is bad because as you've seen in history, say 19th century U.S. economic history, for most of the time the U.S. was in deflation but real wages went up.