JN Daily – BOJ on deflation, Japan Car Sales Fall to 28-Year Low

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BOJ Struggling To Find Ways To Combat Deflation

Looks like they got it right:

BOJ Struggling To Find Ways To Combat Deflation (Nikkei) – “We have run out of ammunition,” said a senior BOJ official. “We aren’t sure what we can do now.” BOJ Gov. Masaaki Shirakawa is deeply skeptical about the idea of lowering the interest rate down to zero – a policy the bank adopted once. Shirakawa thinks the approach would be ineffective and detrimental to the functioning of the money market. The central bank is also unwilling to revive the so-called quantitative easing. The central bank says it is not clear that the five years of the BOJ’s quantitative easing from March 2001 really produced expected effects. In particular, many in the BOJ are critical of the bank’s attempt to stimulate economic growth by increasing money supply through setting targets for the reserve account balances commercial banks are required to maintain at the central bank. It is now accepted wisdom at the BOJ that this tactics did not work.


Slowly coming around to the notion that output and employment are functions of fiscal balance.

Local Govts On The Hook For Y30tln In ‘Hidden’ Liabilities
Toyota Extends Japan Output Suspension By 11 Days
Toyota, Nissan Lead Drop as Japan Car Sales Fall to 28-Year Low

So maybe the problem with the US car industry is the macro economy more so than management issues???

Japan Business Leaders Say Dollar May Trade at 100 Yen in 2009

Maybe they know something about the return of MOF USD purchases?