The has been a very interesting week from the standpoint of monetary policy. Not because investors are uncertain about what Central Banks are going to do, but because they know what the Fed is going to do. Tomorrow, the ECB, Swiss National Bank and the Bank of England will release their respective monetary policy decisions. Seems to us, that nobody cares, probably because Mario Draghi will yap on and on with the end result being a continuation of massive money printing and the suppression of interest rates. The BOE and SNB are sure to do the same.
The Bank of Japan is remarkable. There is nothing they will not buy. After buying massive amounts of government debt, they moved to buying stocks. Taken to a logical conclusion, the BOJ will end up owning everything in the Japanese economy. Remember, they started buying assets (Quantitative Easing) in the year 2000 when their real estate and stock market bubble burst.
The chart above shows the amount and percentage of Japan EFTs the BOJ owns. At the moment it is 75%. We wonder what is stopping them from buying everything. They are not alone in buying equities. The Swiss National Bank prints money and buys US stocks. They currently own $80 billion worth. When did central banks, the lender of last resort, they stabelizer of economies, baoilouter in chief of their respective banking industries become hedge funds?
