Japan: liquidity boost and asset purchases

Japan Adds $183 Billion to Economy, Doubles Asset Purchases

By Mayumi Otsuma and Keiko Ujikane - Mar 14, 2011 6:07 AM GMT-0300

The Bank of Japan poured a record amount of cash into the financial system and doubled the size of its asset-purchase plan to shield the economy from the effects of the nation’s strongest earthquake on record.
The central bank pumped 15 trillion yen ($183 billion) into money markets today to assure financial stability amid a plunge in stocks and surge in credit risk. Governor Masaaki Shirakawa and his board also enlarged a program buying assets from government bonds to exchange-traded funds to 10 trillion yen.
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Comment: The problem is not to act this way in an emergency of the size as today. The problem is that Japan did squander its wealth before that the economy is already drowned half-dead by liquidity and that the government has overborrowed long before. We have this problem with almost any governments nowadays. Nothing is left for the so-called dry day not to speak of when catastrophe hits.