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You understand the Japanese Central Bank is purchasing Securities (stocks), not simply Bonds like The US Fed did during QE and still does as it is currently rol

You understand the Japanese Central Bank is purchasing Securities (stocks), not simply Bonds like The US Fed did during QE and still does as it is currently rolling over all of the bonds and Mortgage Backed Securities which are maturing

Retric 11y ago
This has the same issue. Dividends plus any gains when they sell the stocks remove currency from circulation.
- ZoeZoeBee 11y ago
  Not at all considering the Japanese are using this to fund the nation's pension system, all of that currency goes back into circulation
  - Retric 11y ago
    ? That does not sound like QE as it does not add any new money into the system. Unless you mean they create money to buy the stuff, and then give the proceeds to the pension system.
    - ZoeZoeBee 11y ago
      That is exactly what the Japanese Central Bank is doing, were you unaware? http://www.wsj.com/articles/boj-helps-tokyo-stocks-to-soar-1426065432 http://www.wsj.com/articles/boj-helps-tokyo-stocks-to-soar-1...
      - Retric 11y ago
        "Analysts say the bank’s action has been a significant driver of Japan’s stock-market rally in recent months, combined with hefty purchases by the $1.1 trillion Government Pension Investment Fund." That sounds like there both buying stock, not that there is a handoff between the two. Quantitative easing is specifically something Central Banks do when they buy stuff using money created from thin air. https://en.wikipedia.org/wiki/Money_creation https://en.wikipedia.org/wiki/Money_creation My point, is after a central bank buy something be it stocks, bonds, gold or pogo sticks with money created on the spot they add money to the economy. But, if they sell it for more than they bought them for then even more money is removed from circulation.
        ZoeZoeBee 11y ago
        Where exactly do you think the JCB is getting that money? Its a form of QE whether you want to acknowledge it is or not. The rest of the world's economists agree The BoJ’s most obvious easing option is more asset purchases. Despite the doubts of some market participants, BoJ officials do not think there is any practical obstacle to buying faster than the current pace of Y80tn a year. It could also expand the scope of purchases to assets such as local government debt, buy longer-term securities, as the US Federal Reserve did under Operation Twist, or — particularly likely given recent market falls — buy more exchange traded funds tracking the Japanese stock market. “We expect the BoJ will do more of the same — increasing the pace of purchases and buying more ETFs,” says Kiichi Murashima, a Citigroup analyst." http://www.ft.com/intl/cms/s/0/d0867f3a-6b24-11e5-aca9-d87542bf8673.html#axzz3rsZQ3UVY http://www.ft.com/intl/cms/s/0/d0867f3a-6b24-11e5-aca9-d8754...

Retric 11y ago

This has the same issue. Dividends plus any gains when they sell the stocks remove currency from circulation.

ZoeZoeBee 11y ago
Not at all considering the Japanese are using this to fund the nation's pension system, all of that currency goes back into circulation
- Retric 11y ago
  ? That does not sound like QE as it does not add any new money into the system. Unless you mean they create money to buy the stuff, and then give the proceeds to the pension system.
  - ZoeZoeBee 11y ago
    That is exactly what the Japanese Central Bank is doing, were you unaware? http://www.wsj.com/articles/boj-helps-tokyo-stocks-to-soar-1426065432 http://www.wsj.com/articles/boj-helps-tokyo-stocks-to-soar-1...
    - Retric 11y ago
      "Analysts say the bank’s action has been a significant driver of Japan’s stock-market rally in recent months, combined with hefty purchases by the $1.1 trillion Government Pension Investment Fund." That sounds like there both buying stock, not that there is a handoff between the two. Quantitative easing is specifically something Central Banks do when they buy stuff using money created from thin air. https://en.wikipedia.org/wiki/Money_creation https://en.wikipedia.org/wiki/Money_creation My point, is after a central bank buy something be it stocks, bonds, gold or pogo sticks with money created on the spot they add money to the economy. But, if they sell it for more than they bought them for then even more money is removed from circulation.
      - ZoeZoeBee 11y ago
        Where exactly do you think the JCB is getting that money? Its a form of QE whether you want to acknowledge it is or not. The rest of the world's economists agree The BoJ’s most obvious easing option is more asset purchases. Despite the doubts of some market participants, BoJ officials do not think there is any practical obstacle to buying faster than the current pace of Y80tn a year. It could also expand the scope of purchases to assets such as local government debt, buy longer-term securities, as the US Federal Reserve did under Operation Twist, or — particularly likely given recent market falls — buy more exchange traded funds tracking the Japanese stock market. “We expect the BoJ will do more of the same — increasing the pace of purchases and buying more ETFs,” says Kiichi Murashima, a Citigroup analyst." http://www.ft.com/intl/cms/s/0/d0867f3a-6b24-11e5-aca9-d87542bf8673.html#axzz3rsZQ3UVY http://www.ft.com/intl/cms/s/0/d0867f3a-6b24-11e5-aca9-d8754...