午夜剧场

It was October 1988 when I was assigned as a reporter covering the Bank of Japan (BOJ) at the news agency where I worked. Without knowing the first thing about my beat, the Heisei era suddenly began two months after I took up my post. Subsequently, the Japanese economy tumbled from the collapse of the bubble into a financial crisis and unprecedented deflation. Even after moving to a broadcasting station in 1996, I remained involved in economic reporting. Believing that recording this historic financial upheaval for future generations is the duty of journalism, I continued intensive investigative reporting. The recently published "Document: BOJ Adrift" is part of that work.

Looking back, the Japanese economy has changed beyond recognition over the past 30 years. It seems like a lie that it was once called "Japan as Number One"; instead, it has gasped in the mire of bad loans due to the aftereffects of the bubble, carried the world's worst public debt, and suffered from a trend-like decline in the potential growth rate. Under such extreme circumstances, it was hit by the COVID-19 crisis of all things, and public finances are now in a state where the bottom has fallen out. The reason the economy is still somehow functioning is that the Bank of Japan is using the "magic" of quantitative and qualitative easing (QQE) to scatter massive amounts of currency.

However, because it is "magic," the risks are also great, and many experts worry that it will eventually bring about heavy side effects.

Why were such unusual and irregular policies introduced? I felt it was necessary to go back to the past and investigate thoroughly. It would be fine if the economy and our lives return to normal in the future, but just in case our children and grandchildren face economic hardships beyond imagination and wonder, "How did it come to this?" I thought it would be better to leave behind a clue to find that answer.

I have written the details in my book, but looking back broadly, there is a strong possibility that the collapse of the bubble and the 1997 revision of the Bank of Japan Act were the start of this straying path. The central bank, which aimed for political independence following the lessons of history, was forced into a "retreating battle" by the financial crisis that occurred at the same timing and the subsequent deflation, and was gradually dragged into the world of unintended dimension-defying easing.

To serve future verification, I refrained from any commentary in my book and concentrated on recording who did what, when, and where. I hope that people will feel the difficulty of central banking and currency management under a democracy from these facts and widely discuss what its ideal form should be.

Tomohiko Nishino

Iwanami Shoten

360 pages, 2,750 yen (tax included)

*Affiliations and titles are as of the time this magazine was published.