Japan increases its use of Quantitative Easing in effort to overcome deflation:stocks rise in response,Keynes on front cover of Business Week

The Governor of the Bank of Japan(BOJ) several days ago announced that the Bank would greatly increase its purchase of government debt financing bonds and expand its asset base and thereby its monetary base in a major effort to reverse deflation and restore inflation targeted at 2 %. At the same time the Government pension investment fund announced it would increase its buying of stocks and decrease its holding of government bonds . The BOJ will increase its purchase of both government debt and stock based Nikkei ETFs. Doing the latter is regarded as qualitative easing because it adds riskier equity assets as opposed to government bonds which finance the national debt. It has an immediate impact along with the decision by the pension investment fund to expand equity purchases on stock market values.So Japan continues on this QE supplemented Keynesian course. We shall see what the outcome is over the next year. Meanwhile John Maynard Keynes is featured on the cover of Business Week magazine for a major story reviewing Keynes and advocating a return to his policies of defict financed spending to push the global economy away from recession and toward more rapid growth. The article is well worth reading particularly for readers who would like an introduction to Keynes in non technical language.

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About haroldchorneyeconomist

I am Professor of political economy at Concordia university in Montréal, Québec, Canada. I received my B.A.Hons (econ.&poli sci) from the University of Manitoba. I also completed my M.A. degree in economics there. Went on to spend two years at the London School of Economics as a Ph.D. student in economics and then completed my Ph.D. in political economy at the University of Toronto. Was named a John W.Dafoe fellow, a CMHC fellow and a Canada Council fellow. I also was named a Woodrow Wilson fellow in 1968 after completing my first class honours undergraduate degree. Worked as an economist in the area of education, labour economics and as the senior economist with the Manitoba Housing and Renewal Corporation for the Government of Manitoba from 1972 to 1978. I also have worked as an economic consultant for MDT socio-economic consultants and have been consulted on urban planning, health policy, linguistic duality and public sector finance questions by the governments of Manitoba, Saskatchewan,the cities of Regina and Saskatoon, Ontario and the Federal government of Canada. I have also been consulted by senior leaders of the British Labour party, MPs from the Progressive Conservative party, the Liberal party and the New Democrats on economic policy questions. Members of the Government of France under the Presidency of Francois Mitterand discussed my work on public sector deficits. I have also run for elected office at the municipal level. I first began to write about quantitative easing as a useful policy option during the early 1980s.
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