Greetings to you all on Christmas Eve. I think the big deal today is not America or Europe, but Japan. The incoming Japanese Prime Minister is threatening to strip the Bank of Japan, the central bank, of its independence. What Mr. Abe said is that the Bank of Japan needs to set at least a 2% inflation target. And he went further, saying that if they do not, he would "revise the Bank of Japan law and set" the 2% target himself. This is serious stuff. And Abe won the election in a landslide. So he can do this, there is no doubt.
Like a lot of macro analysts, I look to Japan now because they are at the forefront of the debt deflationary revolution we have entered at this end of a debt super cycle. They got to peak debt first. Japan resorted to zero rates first. And these zero rates turned in...
As this site is now reader-supported via Patreon, the remainder of this article is only available to subscribers at a specific patronage level. Articles at patronage levels BRONZE, SILVER, and GOLD are denoted by the categories in blue capital letters above the post. Posts categorized DAILY are available to both SILVER and GOLD patrons.
Edward Harrison is the founder of Credit Writedowns and a former career diplomat, investment banker and technology executive with over twenty five years of business experience. He has also been a regular economic and financial commentator in print and on television for the past decade. He speaks six languages and reads another five, skills he uses to provide a more global perspective. Edward holds an MBA in Finance from Columbia University and a BA in Economics from Dartmouth College.