Did You Know You Can Purchase Part of A Major Central Bank?

Every day the business press is filled with stories about what key central banks like the Federal Reserve, the Bank of England or the Bundesbank are  doing to influence global economic affairs.  For most of us these banks are relatively abstract institutions that control our lives but over which we have no control.  However, there is one central bank that is unique.  The Bank of Japan, which controls the money supply of the 3rd largest economy in the world, has shares traded on one of the Japanese stock markets.  This means you can buy and sell parts of this central bank just like buying and selling shares of a major corporation like Google or Toyota.  Not many people know about this and even fewer trade the stock.  The day this was written just 5 trades happened. Continue reading

Is Japan Really in a Recession?

Yesterday and today the business news highlighted a story that Japan was now in a recession.  The media defines a recession as any time a country has two consecutive quarters of falling GDP.    The graph from the Wall Street Journal, seen at the bottom of this post, confirms that Japan’s GDP has shrunk over the last six months.  Based on the extensive negative press coverage Japan’s Prime Minister Shinzo Abe has called for early elections.  An important question needs to be asked.  Is Japan really in a recession?  There are three reasons why Japan’s economy is much healthier that the media portrays.   These three reasons strongly suggest to me that Japan is not in recession right now. Continue reading