Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

Bank of Japan, in a Surprise, Adopts Negative Interest Rate

nytimes.com

Post reply on HN
Print view View original

151–160 of 250 posts

Re: Bank of Japan, in a Surprise, Adopts Negative Interest Rate

#151

Post by Rumford »

akerro wrote: post #45
Rumford wrote: post #31

Earlier quoted context omitted.

Your instincts are not wrong, believe it or not. Unfortunately most economists fall short of the current state of their science. The first thing one needs to understand about economics is how rife it is with special pleading from selfish interests, because the output of economic science is so important to justifying public policy prescriptions. One thing that is constantly ignored is how government fiddling with the…

Would you recommend Economyths by David Orrell?

Sounds like a really interesting book! I read the synopsis and the mainstream is sorely in need of a approach that acknowledges the extreme complexity and heterogeneity of an economy. Nothing irks me more than to see Paul Krugman speak of the world as if it can be quantified in a handful of "aggregate" variables and then blame his political enemies any time things don't go according to plan.

Re: Bank of Japan, in a Surprise, Adopts Negative Interest Rate

#153

Post by pbhjpbhj »

chimeracoder wrote: post #147
marvin wrote: post #106

Earlier quoted context omitted.

Do we agree on what "growth" means in this instance? Is is possible to have increased leisure/increased standard of living/increased health/decreasing cost of living over time, without having an incerase in GDP and an average positive return on capital? Or do we give up the expectancy of a better life for everyone if we give up economic growth as we know it?

> Do we agree on what "growth" means in this instance? There's a disconnect between how economists use certain terms as well-defined technical jargon and how non-economists adopt them colloquially.[0] This leads to a lot of confusion when people try to discuss economics without understanding the precise meanings of the terms at play. For the rest of this comment, I'm going to use the economic meaning of these terms,…

>It would be impossible to have "a better life for everyone" without economic growth. //

Can you go in to this more - for example I have a better life now on half the wage I had before, less means but more of the non-material blessings of life (time with family primarily). It seems if there was wide scale emulation of this that outputs in the [UK] financial system would decline but happiness/fulfilment would increase.

>That is considered "growth" to an economist, yes. //

Is there a name given to such metric generally? If GDP goes down but leisure time increases and leads a increase in health (and reduced health spending) then generally economists would refer to that as "economic growth"?

Re: Bank of Japan, in a Surprise, Adopts Negative Interest Rate

#154

Post by ddeck »

jernfrost wrote: post #109
HSO wrote: post #86

Those who think Japan is unique in its condition and/or that the answer to its problems is more of the same old "advice" as proffered by standard issue economists and business types might profit from Robert Gordon's recently published "American Growth". (paper version: http://www.nber.org/papers/w18315.pdf ) At least, it can offer a different, longer-term perspective on the issues. It's not impossible that we will lo…

But the growth problems of Japan is largely an illusion and myth caused by population decline. Growth per capita in Japan has been completely normal in the supposed terrible years. It is the population decline which causes the overall GDP growth to look anemic. Naturally it is growth per capita which matters as this is what improves the living conditions of people. There are many countries with high GDP growth but wh…

>But the growth problems of Japan is largely an illusion and myth caused by population decline.

The piece that many miss when discussing Japan's high quality of life despite lack of growth is that in order to maintain 0% growth over the last 20 years, the central government had to borrow and spend nearly 10% of GDP every single year.

Re: Bank of Japan, in a Surprise, Adopts Negative Interest Rate

#155

Post by Amezarak »

Adam_O wrote: post #104
hackerboos wrote: post #63

Earlier quoted context omitted.

The key phrase here was 'aging population'. If the majority of Japan's population are retired then there will still be a huge deficit. Japan needs to bite the bullet and accept immigration as part of its economic strategy.

Thinking out loud.. the Olympics in 2020 will be a good chance to showcase the country as an attractive destination, not just for tourism. They could loosen their immigration policy to coincide with the timeline. It would still be tricky because as a society Japan is famously homogeneous, so the idea of diversity would have to be phased in slowly.. but it could be a starting point. In the end it's about adaptation to…

> In the end it's about adaptation to ensure a future for the country.

I think that most Japanese would believe that a future Japan that wasn't majority Japanese was no future at all.

From the nationalist perspective, you're essentially saying "to save Japanese society we must destroy Japanese society." To these people Japan is more than just an island, it is Japanese.

Re: Bank of Japan, in a Surprise, Adopts Negative Interest Rate

#156

Post by jahnu »

ddeck wrote: post #154
jernfrost wrote: post #109

Earlier quoted context omitted.

But the growth problems of Japan is largely an illusion and myth caused by population decline. Growth per capita in Japan has been completely normal in the supposed terrible years. It is the population decline which causes the overall GDP growth to look anemic. Naturally it is growth per capita which matters as this is what improves the living conditions of people. There are many countries with high GDP growth but wh…

>But the growth problems of Japan is largely an illusion and myth caused by population decline. The piece that many miss when discussing Japan's high quality of life despite lack of growth is that in order to maintain 0% growth over the last 20 years, the central government had to borrow and spend nearly 10% of GDP every single year.

They borrowed it mostly from themselves though which makes it more complicated and much less of a problem than it might at first appear.

Re: Bank of Japan, in a Surprise, Adopts Negative Interest Rate

#157

Post by kaonashi »

raverbashing wrote: post #24
wrong_variable wrote: post #3

I do not understand this. Japan imports almost all of its oil and commodities. Shouldn't low price of oil and commodities result in a massive surplus for a country that sells high value added goods ? Buy iron for cheap and sell robots for a high price. Now the argument many people will make is that the people who are buying the high-value added goods won't have money anymore - but the argument can be made in the oppo…

> Citing "low price of oil" as a reason for economic woes just seems like bad science - I though economists were better than this ? Yes it is, no they aren't Especially "specialists" commenting in the press. The problem with Japan is the complete stagnation of their economy. China makes it cheaper, internal consumption is decreasing. Trying to "create inflation" is pretty much as effective as trying to defibrilate a…

They keep hiking income tax rates before inflation ever materializes, that's a good way to keep deflation going indefinitely.

Cut taxes, especially in the lower brackets, you will find your inflation eventually. Japan just doesn't want to do that.

Re: Bank of Japan, in a Surprise, Adopts Negative Interest Rate

#158

Post by ifdefdebug »

jevgeni wrote: post #129
ifdefdebug wrote: post #37

Earlier quoted context omitted.

You just had to find a way to pull the gender issue into a thread that has nothing to do with it right? Completely off topic, sorry.

No. To be clear: I used sarcasm[1] to highlight the in my opinion ridiculous preferences of HN readership. ___ [1] - https://en.wikipedia.org/wiki/Sarcasm

I see. And of course I take that wikipedia link to sarcasm for sarcasm.

Anyway, the heavy discussion around this post seems to disprove your point making your sarcasm harder to spot.

Re: Bank of Japan, in a Surprise, Adopts Negative Interest Rate

#159

Post by jahnu »

jessriedel wrote: post #118
jernfrost wrote: post #109

Earlier quoted context omitted.

But the growth problems of Japan is largely an illusion and myth caused by population decline. Growth per capita in Japan has been completely normal in the supposed terrible years. It is the population decline which causes the overall GDP growth to look anemic. Naturally it is growth per capita which matters as this is what improves the living conditions of people. There are many countries with high GDP growth but wh…

What time period are you talking about? In 1991, per capita GDP in US and Japan were both ~$32k in 2005 USD. But now it's ~$38k for Japan and $47k for US. http://www.tradingeconomics.com/united-states/gdp-per-capita http://www.tradingeconomics.com/japan/gdp-per-capita

Household disposable income looks normal enough

https://data.oecd.org/hha/household-disposable-income.htm

Re: Bank of Japan, in a Surprise, Adopts Negative Interest Rate

#160

Post by ddeck »

jahnu wrote: post #156
ddeck wrote: post #154

Earlier quoted context omitted.

>But the growth problems of Japan is largely an illusion and myth caused by population decline. The piece that many miss when discussing Japan's high quality of life despite lack of growth is that in order to maintain 0% growth over the last 20 years, the central government had to borrow and spend nearly 10% of GDP every single year.

They borrowed it mostly from themselves though which makes it more complicated and much less of a problem than it might at first appear.

I doubt the average Japanese saver would see it that way.

I agree, we're not talking about an external default, but monetization is still likely to severely impact the wealth of the middle class.

Post reply on HN