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Princes Of The Yen - Documentary.

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Central Banks are some of the most secretive and misunderstood institutions in the world. What powers do they wield? Whose interests do they serve? How do their actions affect our everyday lives?


In 2003, Richard Werner released a book by the title of “Princes of the Yen”, which cut through the complex jargon of central bankers and for the first time made this obscure world accessible to the public. The book became a number one bestseller in Japan. Yet, over ten years after it was first released, the English version, is still on its first edition!


Told within the context of the history of 20th Century Japan, Richard Werner meticulously solves the puzzle of central banks, and explains the social, political and economic impacts their actions have. The documentary provides the viewer with a new understanding of economics and shows how events that may appear disjointed in popular discourse are in reality intimately intertwined.


“Princes of the Yen” is an independent, self-funded documentary. It was made as a sequel to 97% Owned, a film about how money is created and the impact its creation has. We realized after making that film that we did not understand how central banks fitted into the picture. “Princes of the Yen” fills that gap, shining a light on a world hidden behind closed doors and obscured by complex jargon, a world which would much rather stay out of sight. And when all the layers are peeled away, what remains, is the understanding of the role central banks play, in inducing and directing change. Change, for which they have no mandate.


Princes of the Yen: Central Banks and the Transformation of the Economy.


“Because only power that is hidden, is power that endures.”



http://princesoftheyen.com/#watchthefilm


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Interesting at the beginning of the video about how discussion of World War 2 etc wasn't allowed in Japan. Apparently something similar happened in Germany as well.

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Thanks for this. I'm familiar with Werner's name but not the book.

The assertion that bank-generated credit creation is responsible for speculative asset bubbles is central to Minsky's work too, of course.

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Thanks for this. I'm familiar with Werner's name but not the book.

The assertion that bank-generated credit creation is responsible for speculative asset bubbles is central to Minsky's work too, of course.

It's not rocket science. If excess credit is created against assets in a particular market, the nominal value of those assets will increase.

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It's not rocket science. If excess credit is created against assets in a particular market, the nominal value of those assets will increase.

Except that the general equilibrium/rational expectation models employed by a majority of economists prohibit it from happening at all.

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From the Princes Of The Yen video there are several similarities with the UK in the post war period and it's interesting that Japan made their central bank "independent" in 1998 about 1 year after the UK did with the BoE.

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Yeah, and when an economist identifies the bleeding obvious it's newsworthy. http://www.salon.com/2015/01/02/joseph_stiglitz_thomas_piketty_gets_income_inequality_wrong_partner/

Economists generally 1. Don't know enough about science to know what they're talking about 2. Fail to generate falsifiable models which can be tested empirically.

The concepts of general equilibrium and utlity maximisation which fill every mainstream economics text book were lifted from nineteenth century physics (Hamiltonian dynamics) without recourse to actual market data. Utility doesn't exist mathematically because the required differential form is nonintegrable. Equilibrium can't be reached in a Hamiltonian system because there's no friction to permit an approach to equilibrium.

By and large, the few economists I've found to be worth reading (Schumpeter, Minsky, Keen) are those whose convictions lie outside and in opposition to the discipline as it's taught and practiced. Steve Keen, for instance, by utilising the principles of double entry book-keeping, much as a bank is obliged to do on an everyday basis, has sought to realise what Richard Werner is calling for, a monetary economic model that fully incorporates the dynamics of credit creation. Hyman Minsky's practical experience of the banking industry through his long-standing consultancy role with the fledgling Mark Twain Bank clearly informed his thinking about the dangers of financial innovation and risk-taking. He experienced first-hand the source material from which all his higher level theorising was done.

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Thanks for the link to that video, I'm 1/4 a way through it - it is well worth watching for everyone stumped by house prices.

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An interesting vid, just listened too it.

The ECB was clearly created with menace if it's offices can't be raided or inspected.

“Let me issue and control a nation’s money and I care not who writes the laws.” Mayer Amschel Rothschild (1744-1812), founder of the House of Rothschild.

“The few who understand the system will either be so interested in its profits or be so dependent upon its favours that there will be no opposition from that class, while on the other hand, the great body of people, mentally incapable of comprehending the tremendous advantage that capital derives from the system, will bear its burdens without complaint, and perhaps without even suspecting that the system is inimical to their interests.” The Rothschild brothers of London writing to associates in New York, 1863.

“I am afraid the ordinary citizen will not like to be told that the banks can and do create money. And they who control the credit of the nation direct the policy of Governments and hold in the hollow of their hand the destiny of the people.” Reginald McKenna, as Chairman of the Midland Bank, addressing stockholders in 1924.

From listening to it the only option appears major central bank reform and total transparency, we are all mere pawns in banker elite games.

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Ok, after watching this and having a little think about it. First, I really can't see how we could turn Japanese? The BOE, apart from dropping rates to almost zero, is in a completely different position to that of Japan in the 1990's. The film suggests that the bubble and crisis was created to change Japan's economic model to the US one. Well we have that already that system and an independent central bank and QE from the off! If this film is to be believed (big IF there!), then we are in a totally different position to that of Japan and there is no point looking there for answers to the future...

I find the IMF link to the Asian crisis interesting but if the US has such control over other countries banking systems, what was the 2008 US/UK crisis about? What was the aim of that?

Lets say the current crisis is to have a closer political union in the EC, maybe the next one is to push the UK into the Euro? If all these crisis' are manufactured then what is the finial point/aim, one world government, keeping us on our toes, making the rich richer (Don't they get bored of having everything! :P)

No answers in this film, a lot of questions and likely a lot of conspiracy theory nonsense, thrown in for good measure! What is this film really trying to say!? :unsure:

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Thanks for the link to that video, I'm 1/4 a way through it - it is well worth watching for everyone stumped by house prices.

A good video. And yet, from what I understand, the Japanese house market is very, very different to the UK's. They regularly demolish and rebuild; houses are almost throwaway items.

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A good video. And yet, from what I understand, the Japanese house market is very, very different to the UK's. They regularly demolish and rebuild; houses are almost throwaway items.

That is correct. They mostly build in timber and replace the buildings every 25 to 30 years. Of course the main property bubbles were in the cities (like in the UK) where buildings are not made of timber, rather concrete/steel high rise. So, not so different to London. The main point from the beginning was that loose lending lead to higher land prices. Something that is easy to also see going on here. What I didn't get was when they went on to say that it was manufactured bubble to change the economic set up, all well and good but what is our bubble about?

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Ok, after watching this and having a little think about it. First, I really can't see how we could turn Japanese? The BOE, apart from dropping rates to almost zero, is in a completely different position to that of Japan in the 1990's. The film suggests that the bubble and crisis was created to change Japan's economic model to the US one. Well we have that already that system and an independent central bank and QE from the off! If this film is to be believed (big IF there!), then we are in a totally different position to that of Japan and there is no point looking there for answers to the future...

I find the IMF link to the Asian crisis interesting but if the US has such control over other countries banking systems, what was the 2008 US/UK crisis about? What was the aim of that?

Lets say the current crisis is to have a closer political union in the EC, maybe the next one is to push the UK into the Euro? If all these crisis' are manufactured then what is the finial point/aim, one world government, keeping us on our toes, making the rich richer (Don't they get bored of having everything! :P)

No answers in this film, a lot of questions and likely a lot of conspiracy theory nonsense, thrown in for good measure! What is this film really trying to say!? :unsure:

I think the gist of Werner's argument is credible. The USD appreciated by 50% between 1980 and 1985 against a basket of currencies including the yen. As a consequence US manufacturing was systematically destroyed by Japanese imports. International efforts to overcome Japan's mercantilist insularity were well advanced by the time the Plaza Accord was signed in 1985 - a multi-polar commitment to lower the dollar. It's not hard to imagine the Chicago boys at the Fed intellectually strong-arming their equivalents at the BoJ with the then-fashionable Reagan-Thatcher doctrines of laissez faire, deregulation and rational expectations.

The Fed's hand in instigating the 2008 crash through its SOMA portfolio seems clear enough. Yes, I'm aware that correlation doesn't prove causality, it does however strongly suggest it. I believe Bernanke used the cash he took from the Primary Dealers to fund the TAF program in late 2007/early 2008 and provide discreet short-term loans to smaller US banks. He apparently had no idea of the scale of the unfolding crisis until much later in 2008 when (post Lehmans) he reversed direction and started pumping furiously.

fed-cash-dealers-2002-2011.jpg

Edited by zugzwang

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