Has the Bank of Japan started another round of central bank wargames?


Never pick a fight with a central bank. The only one who gets hurt is you. Unless, of course, you are another central bank.
Central banks routinely intervene in the markets to influence the prices of assets, commodities and currencies. That’s the way monetary policy is conducted. It’s the principle behind QE.
Generally, everyone co-operates.....
Have you ever wondered why they do? In this piece at Forbes I use a game theory explanation for the ability of central banks to manipulate markets, and apply it specifically to the Bank of Japan's exorbitant QE commitments. 


  1. Is it your expectation then, Frances, that CBs will indefinitely intervene to keep asset prices (specifically equities) inflated? And will they/can they succeed indefinitely?

  2. This what do BoJ is madness. They copy policy from FED but without any strategy...


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