Re: Banks vs Capital Markets

["Kazuhiro Kurose" <kurose@xxxxxxxxxxxxxxxxxxxxxx>]

Dear Basil Moore

Thank you for replying.You said as follows.
> But I disagree that this implies monetary policy is impotent. Look at the
> US, where Greenspan is raising the rate by just 25 basis points a time, and
> the capital markets are quivering.

I think that the expressions in my previous mail was inadequate (because I am Japanese). I agree with you! What I wanted
to say was that monetary policy can't control money supply at least. In VERTICALIST AND HORIZONTALIST, you have pointed
out the asynmetry of monetary policy. In other words, central bank can't decrease quantities of money even if it can
increase. Do you agree with me?

As for land price, is she Japanese speaker or English speaker? I think no doubt that  it can earn in Japanese. But I'm
not sure it can also earn in Engilish. If she is Japanese speaker, a following homepage is benefitical for her.
http://www.nla.go.jp/tocchi/1999/index.htm
This page is National Land Agency's. But I'm sorry that this is only in Japanese.

By the way, as for resent a stuation of Japanese economy, I think that asset deflation, as you said, is one of
explanable factors. Since assets prices leaded induce people to consume and invest too much in Bubble age, I think that
sluggishness of assets prices discourages consumption and investment so much. I think that recent Japanese economy falls
into a kind of 'liquidty trap' because people or firms feel anxiety for their future. Therefore, to ease monetary policy
don't arouse consumption or investment. It is said  recenty that aggregate savings were growing rapidy in spite of
lowing interest rate. It is defferent for each persons wether what they feel anxiety about. Some people are anxious
about being dismissing, others are anxious about their pension. In all cases, people are reluctant to consume, it goes
without saying that people who earn their living by pention are also reluctant.
I think that the most necessary policy is to eliminate these anxiety rather than simply fisical or monetary policy. For
example, to reestablish pension fund or to make sure social security, to constract various systems which are adequate
for recent Japanese economic structure and so on. Though I think that capitalism is essentially instable and bussiness
cycle is inebitable, as almost Post Keynesia have arged, it is due to politics that depression after collapse of Bubble
has continued so long like this. Japanese politician and bureaucracy are lack of idea. It can be said that 'political
innovation' is necessary for Japan.

What do you think about my opinion?

Sincerely

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  Kazuhiro Kurose
  Hokkaido University, Faculty of Economics
    Kita 9 Nishi 7, Kita-Ku, Sapporo, Japan
    060-0809
    TEL: ++81-11-716-2111 ex:2786
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