The Japanese central bank, the Bank of Japan, has reached a point at which it has two options left: (a) make monetary policy even more extreme, with helicopter money, or (b) conclude that their Keynesian solution of loose, looser, loosest monetary policy has failed. Last week, Haruhiko Kuroda announced that the Bank of Japan will buy more ETF’s (yes, more, the Bank of Japan already buys index funds) and lend more dollars to Japanese companies with overseas business (yes, the Bank of Japan was

While ECB-chairman Mario Draghi firmly continues buying up bonds (but for now decided to keep rates where they are and not increase the pool of eligible assets by relaxing the boundaries of its purchase program), an important question arises. Can a central bank go bankrupt? Central banks can certainly become insolvent or, in other words, have a negative equity with the value of their liabilities surpassing the value of their assets. Better yet, it is very likely that the coming years central

Gold investors tend to fear “bail-in” laws for banks, but it seems Italy cannot avoid a “bail-in” for its bankrupt banking system. Last month, I showed how delinquency rates are moving up in the Eurozone. However, most delinquencies are concentrated in the country of Italian prime minister Matteo Renzi. Matteo Renzi complained about the European bail-in law. And why wouldn’t anyone want to make an exception for the Italians? We will see that the concept of a bail-in is perfectly fine, but Renzi does not want a bail-in and has substantial leverage in negotiating a bailout of the bankrupt Italian banking system because of Brexit.