Amid all the debate about the US economy and the somewhat vague prospect of the Fed finally showing some cojones at some point in the future, the principle feature which allows the Doves to block any renormalization of the rate is the supposedly soft state of the labour market, particularly with reference to the sorry-looking participation rate.
Category Archives: Japan
Abenomics gives Sato the ‘pip’
In a widely reported speech given in Kochi, BOJ board member Takehiro Sato gave voice to some of the dissent which has riven policy makers – and, we suspect, much of Japanese society – over the issue of whether the government’s latest resort to the Patent Inflationary Panacea (henceforth, the ‘PIP’) is likely to have the desired effect.
Expressing doubts over whether a hard ‘target’ for the attainment of a steady rate of price escalation of 2% a year – that latter-day shibboleth of collectivist Macromancy – Sato made the very reasonable, if little shared, individualist observation that ‘prices reflect the temperature of the economy, not a variable [sic] that can be directly controlled by a central bank.’