MCViewPoint

Opinion from a Libertarian ViewPoint

Posts Tagged ‘Bank of Japan’

Fed’s Core Mission Now Includes Climate Change

Posted by M. C. on January 30, 2020

Here’s a lesson for you climate fearmongers: Never put a time frame on your prediction that is shorter than your expected life or you will be ridiculed until you die.

https://moneymaven.io/mishtalk/economics/fed-s-core-mission-now-includes-climate-change-9i0VcEMMnka-AOFy69N5XQ

Mish

The Fed, ECB, Bank of England, and Bank of Japan have now embraced climate change as part of their mission.
It’s bad enough that central bankers are clueless about inflation.They now want their hands in another thing they do not understand and cannot control even if they did.

Fed’s Core Mission Change

Lael Brainard, Chair of the Fed’s Committee on Financial Stability, says Climate Change Matters for Monetary Policy and Financial Stability.

So how does climate change fit into the work of the Federal Reserve? To support a strong economy and a stable financial system, the Federal Reserve needs to analyze and adapt to important changes to the economy and financial system. This is no less true for climate change than it was for globalization or the information technology revolution.

To fulfill our core responsibilities, it will be important for the Federal Reserve to study the implications of climate change for the economy and the financial system and to adapt our work accordingly.

Climate Change Essential to Achieving Mission

Brainard was just one of the speakers at the Fed’s Economics of Climate Change summit last November.

Mary Daly, San Francisco Fed president has this Q&A in her presentation.

Q: Why is the San Francisco Fed hosting a climate conference? Why this? Why now?

A: The answer is simple. It’s essential to achieving our mission.

Bank of Japan Warns of Climate Change Risks

Japan Times reports Bank of Japan Gov. Haruhiko Kuroda Warns of Climate Change Risks.

The challenges posed by a string of recent natural disasters and the potential hit to the economy from slowing overseas growth “should be better addressed by government with fiscal policy and structural policies,” Kuroda said at a seminar.

As Japan is prone to big typhoons and earthquakes, Kuroda highlighted the risks related to climate change as an example of new issues central banks must deal with in maintaining financial stability.

“Climate-related risk differs from other risks in that its relatively long-term impact means the effects will last longer than other financial risks, and the impact is far less predictable,” he said. “It is therefore necessary to thoroughly investigate and analyze the impact of climate-related risk.”

Bank of England Climate Change Warning

The Bank of England hopped on the climate change bandwagon on December 30, with a Climate Change Warning from BoE Chief Mark Carney.

The world will face irreversible heating unless firms shift their priorities soon, the outgoing head of the Bank of England has told the BBC.

He said leading pension fund analysis “is that if you add up the policies of all of companies out there, they are consistent with warming of 3.7-3.8C”.

Scientists say the risks associated with an increase of 4C include a nine metre rise in sea levels – affecting up to 760 million people – searing heatwaves and droughts, and serious food supply problems.

“Now $120tn worth of balance sheets of banks and asset managers are wanting this disclosure [of investments in fossil fuels]. But it’s not moving fast enough.”

ECB in on the Climate Change Act

The Financial Times reports Christine Lagarde Wants Key Role for Climate Change in ECB Review.

Consider this Open Letter to ECB head Christine Lagarde from the European Parliament.

During your hearing at the European Parliament, you rightly pledged to make sure the ECB puts the “protection of the environment at the core of the understanding of its mission.” As academics, civil society and trade union leaders, entrepreneurs and citizens deeply concerned by climate change, we believe that the most powerful financial institution in Europe cannot just sit passively as we witness a growing environmental crisis.

Climate change not only imperils life-sustaining processes, it also threatens the financial stability, real economy and jobs. It has been estimated that without mitigation efforts, physical risks related to climate change could result in losses of up to $24 trillion of the value of global financial assets.

Wow. $24 Trillion at risk.

Nonetheless, Germany’s Bundesbank president Jens Weidmann, who also sits on the on the ECB’s governing council, understands the silliness of the move.

Weidmann says that he would view “very critically” any attempt to redirect a central bank’s actions towards climate change, such as favouring the purchase of green bonds as part of a quantitative easing programme.

Weidmann is guaranteed to be overruled.

Excellent Video on Climate Nonsense

Global Warming Fraud Exposed In Pictures

Please consider Global Warming Fraud Exposed In Pictures

The key to understanding the fraud is a changing timeline for temperature, fires, Winters, growing seasons, and sea level, all cherry picked for maximum impact.

Central Bank Fearmongering Blue Ribbon Contenders

  1. European Parliament: $24 Trillion in Damages
  2. Bank of England: 9 Meter rise in seal level (29.53 feet).

To decide who wins the blue ribbon, first let’s do a simulation.

10 Meter Rise in Seal Level

Mercy!

The above Alarming Map shows what might be left of Florida when the sea level rises by 10 meters.

Caney said 9 meters but the average elevation of Florida is allegedly only 6 feet. The highest elevation is only 312 feet.

Mark Carney Wins Fearmongering Blue Ribbon

I give Mark Carney the Central Bank fearmongering Blue Ribbon because people can understand the concept of Florida being three feet underwater.

In contrast, no one understands $24 trillion. Besides, that estimates will soon be $250 trillion or higher due to Fearmongering Inflation.

Fearmongering Lesson

None of the above tops AOC who says World Will End in 12 Years: Here’s What to Do About It

Here’s a lesson for you climate fearmongers: Never put a time frame on your prediction that is shorter than your expected life or you will be ridiculed until you die.

Mike “Mish” Shedlock

Be seeing you

 

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The Bank of Japan Shrinks the Pocket Money of Japanese ‘Salarymen’ | Mises Wire

Posted by M. C. on November 6, 2019

This could mean that a few rich Japanese, who are holding large amounts of stocks and other assets, may be the only ones who benefited from the new stock price inflation. In contrast, the majority of Japanese continues to tighten their belts, as real wages continue to fall in the face of sluggish productivity gains. This points to the unjust distribution effects of the Abenomics, which make the rich richer and all others poorer. This phenomenon cannot only be observed in Japan, but also in the euro area where Christine Lagarde is expected to follow the Japanese monetary policy pattern.

https://mises.org/wire/bank-japan-shrinks-pocket-money-japanese-%E2%80%98salarymen%E2%80%99?utm_source=Mises+Institute+Subscriptions&utm_campaign=5c1466ac47-EMAIL_CAMPAIGN_9_21_2018_9_59_COPY_01&utm_medium=email&utm_term=0_8b52b2e1c0-5c1466ac47-228343965

In December 2012, Japan’s Prime Minister Shinzo Abe set out three arrows in his quiver to pull the country out of the more than 20 years lasting stagnation. Immense purchases of assets by the Bank of Japan, huge government spending programs and structural reforms should deliver a sustained recovery to the Japanese people. In the meantime, it is becoming evident that so-called Abenomics is – despite buoyant stock prices – a damp squib. Inter alia, this is indicated by the pocket money of Japanese “salarymen,” male white-collar workers who commute day-to-day in dark suits by stuffed trains to the central business districts of the Tokyo metropolitan area.

Nikkei 225 and Pocket Money of Japanese ‘Salarymen’

bojarticle_1024.png
Source: Shinsei Bank, Nikkei.

Traditionally in Japan the men earn the money and the wives manage the household. A Japanese proverb says that the wife controls the purse strings, with the women being quite generous. In 2019, the Japanese male white-collar workers still received on average 36,747 yen (almost 340 US dollars) per month for bars, restaurants and other leisure activities in which their wives are typically not involved.

But the good times are long gone.

In the second half of the 1980s, when sharp interest-rate cuts by the Bank of Japan inflated during the so-called “bubble economy,” stock and real estate prices – as well as wages and bonuses – the pocket money of salarymen skyrocketed. Between 1985 and 1990, both stock prices and pocket money grew by about 50 percent each (see chart). At the top of the bubble in 1989, pocket money averaged almost 80,000 yen (a good 600 US dollars) per month. At that time, drinking every night in the bars without limits symbolized the exuberance.

Since the bursting of the Japanese bubble in the early 1990s, both stock prices and pocket money have steadily declined. By the time Abenomics started in January 2013, stock prices had fallen by 73 percent and the pocket money of salarymen fell by 51 percent. The efforts of the Bank of Japan to cushion the crisis by cutting interest rates to zero and pioneering on unconventional monetary policy measures could not prevent Japanese housewives from pulling the string of the purses tighter and tighter. The wives seem to have been guided by both the doldrums on financial markets, and the gradually declining wages since the 1998 financial crisis.

Thus, the pocket money indicator also says something about the success of Abenomics from the viewpoint of the ordinary Japanese people. Since Haruhiko Kuroda took office as president in March 2013, the Bank of Japan has bought government bonds, corporate debt, ETFs and J-REITs amounting to 405,000,000,000,000 yen (approx. 3,700,000,000,000 dollars) to jumpstart the Japanese economy. Nevertheless, Kuroda could not convince the Japanese housewives to loosen the purse strings. While the Abenomics have, to date, boosted the Nikkei stock index by 130 percent, the pocket money continued decreasing near to the level of 37 years ago (34,100 yen in 1982). This indicates that in the sentiment of the Japanese people the post-bubble crisis has never ended up to the present.

This could mean that a few rich Japanese, who are holding large amounts of stocks and other assets, may be the only ones who benefited from the new stock price inflation. In contrast, the majority of Japanese continues to tighten their belts, as real wages continue to fall in the face of sluggish productivity gains. This points to the unjust distribution effects of the Abenomics, which make the rich richer and all others poorer. This phenomenon cannot only be observed in Japan, but also in the euro area where Christine Lagarde is expected to follow the Japanese monetary policy pattern.

Be seeing you

Zatoichi: The Blind Swordsman [1989] - internetplans

 

 

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