The point of the BoJ action was to drive the cash rate down as low as it could go ... effectively 0.1%. That led to the swing in the Yen exchange rate from an Importers rate to an Exporters rate, which supports the monetary policy.

No monetary policy ever works one-handed, and the other half of the policy to allow Japan to weather the storm caused by the massive restructure of production by Japanese corporations from roughly 90% domestic value added to roughly 60% was an extended period of very high deficit spending.

That massive restructure knocked the legs out of domestic investment in plant and equipment in Japan for a decade. But without the move to the for-most-intents-and-purposes 0% cash rate and big government stimulus, the "lost decade" would have been a Depression rather than a decade of relative stagnation punctuated by three recessions.


I've been accused of being a Marxist, yet while Harpo's my favourite, it's Groucho I'm always quoting. Odd, that.