Yet, there is no evidence that any action by BoJ resolved stagnation in Japan’s economy. Japan - just like USA - has its own unique set of internal rules and politics that no matter how many academics get together and come up with a plan - it wont work. I have no idea what the solution is but it surely will not be found in BoJ drawings.
And, BTW, due to debt ownership, Japan is fighting deflation not inflation.
I read Sander’s report and it is error filled. First, Credit Suisse (for example) is a US bank with headquarters in Switzerland. That is the case for all the “foreign” banks - they are really American. A US bank serves US customers and is chartered in the US even if they have HQ elsewhere.
Sanders failed here. Yes, he is a stand up guy who really means well but there is a reason he is not on the Senate banking committee.
Regardless, they’re a financial institution headquartered in Switzerland, and whether because of purely innocent liquidity issues cause by the financial crisis, or their shenanigans, they got sweetheart loans from OUR central bank. If Credit Suisse’s US operations were really at risk, then the Swiss could have dealt with it.
“Temporary” “overnight” lending that lasts for three straight years should be counted in cumulative. That type of lending is supposed to be available in the manner in which it was made available.
What is a sweetheart loan?
Credit Suisse posts collateral in the form of US Treasuries and pays us nominal interest.
So what?
They avert a catastrophe and we profit. Yes, that is a sweetheart no-risk loan - for US taxpayers.
There was no profit there. There was certainly liquidity, but no profit there. Massive bailouts with little scrutiny gave us a TBTF financial system, and provided an excuse for the reduction trend in government spending that continues today. Think of all the states that could have been propped up over those 3 years and not been forced to lay off teachers and police or eliminate state programs that help the needy. But hey, at least the banks got 3 years of overnight loans and swaps so they could continue gambling.
Nominal interest is the sweetheart part of the deal. When you’re bailing someone out, they’re supposed to feel pain.
The TBTF financial system was a result of lax interstate banking laws and deregulation in general. It had nothing to do with the Federal Reserve.
And the Fed is not in a position to loan to states. It is the bank of last resort by design. That part of your argument is a non sequitur.
I do like a liberal vs liberal argument though.