April 11, 2006

A CENTRAL BANK THAT'S CLOSER TO THE MARK:

Japan leaves rates close to zero (BBC, 4/11/06)

The Bank of Japan has left its interest rates at close to zero, as it tries to keep the economic recovery on course.

Posted by Orrin Judd at April 11, 2006 7:01 AM
Comments

Low Japanese interest rates have been very helpful to the U.S. economy as well, as individual investors borrow money in Japan for next to nothing, and then invest that money in America, or buy U.S. Gov't paper.

Posted by: Michael Herdegen [TypeKey Profile Page] at April 11, 2006 7:38 AM

If the BOJ (or anybody else) decides to go negative, does that mean they 'give' money to banks when they borrow? Do they sign terms to pay back less, or do they get a kicker up front? Is there any difference?

Posted by: ratbert at April 11, 2006 1:58 PM

The BOJ has gone negative in recent years.

Posted by: oj at April 11, 2006 2:02 PM

oj: Huh? I thought they bottomed out at 0.00001 or something like that...

Posted by: b at April 11, 2006 3:32 PM

No, they had negative rates in the '90s.

Posted by: oj at April 11, 2006 3:38 PM

Got any links for that? Here's what I see:
http://news.bbc.co.uk/2/hi/business/4754076.stm:
"The Bank of Japan has followed its "quantitative easing" policy for the past five years - keeping the cost of borrowing low by holding interest rates at zero and making it easier for banks to lend money by pumping extra cash into the banking system."

Posted by: b at April 11, 2006 4:52 PM

www.everything2.com/index.pl?node_id=1375475

www.google.com/search?q=japan+negative+interest+rates&start=0&ie=utf-8&oe=utf-8&client=firefox-a&rls=org.mozilla:en-US:official

Posted by: oj at April 11, 2006 5:40 PM
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