It is so long since the BoJ has intervened that there is no one there who with any experience of wading in and dampening volatility (or whatever it is that it is supposed to do).
How do you go about practising intervention? My chum LO reckons it’s done by opening up a demo account with a retail aggregator; now that would be a novel means of intervention wouldn’t it?
Meanwhile in the Emerald Isle, following on from the news that the Irish government has decided Anglo Irish Bank will be split into a funding bank and an asset recovery bank or, more colloquially, a ‘good’ bank and a ‘bad’ bank, the latest word is that the good bit will be named Anglo and the bad bit Irish. (I don’t write this, you understand, I merely report it).
Of the split, website zero hedge opined: “Those who are familiar with Lehman will recall that this was a plan expected to be put into place for Lehman, in which a CRE-asset holding division would be spun off and allowed to roll off its assets. This plan was scrapped as it was deemed unviable. Glad to see it will work in Ireland.”
In more Irish news: the Irish Nationwide building society has issued €4 billion of bonds effectively to itself, according to the Irish Times. The bonds are government-guaranteed, so Irish Nationwide can use the bonds to draw €4 billion in funding from the European Central Bank to help tide it over a key refinancing period later this month. If the story is correct, it’s absolutely frightening.
