For this last week or so, the yen has been hovering around ¥76.8 yen to $1 US dollar. Every time the yen has gotten strong, until now, the Japanese government has thrown massive amounts of money away in vain attempts at intervening to stop the yen's rise. And every time they've done this they have failed, yet they keep doing it over and over.
I wrote in "Japanese Government: These People Are Just Plain Nuts":
They intervened in the yen at ¥76.9, spending some $50 billion dollars. The yen rose to over ¥80 to the US dollar. Now, today, exactly one week later, we're right back where we started. The yen today, as of 4:11 am August 11, 2011 Japan time, is at ¥76.81...
Now they are considering doing this again!? What is wrong with these stupid people?
Since, at that time, the Japan Central Bank (JCB) claimed it was "watching the market and would act accordingly" I have been expecting to see the yen jump back to ¥80 to $1 US Dollar over this past week or so.
It hasn't happened.
Now, Bloomberg says that some clown nick named, "Mr. Yen" (a former finance minister says the yen could hit ¥75 to $1 US Dollar soon.
Japan’s currency may strengthen to a postwar high against the dollar because of the weakness of the U.S. economy, said former Finance Ministry official Eisuke Sakakibara, who’s known as “Mr. Yen.”
“The yen may appreciate further, beyond 75,” Sakakibara said in an interview from Tokyo on Bloomberg Television today. “I would expect the U.S. economy to be fairly weak for a long period of time.”
The yen declined today after Finance Minister Yoshihiko Noda warned that he’s ready to intervene again to stem gains that pose a risk to exports. On Aug. 4, the government sold the currency to stem gains that threaten exporters’ profits. The yen has since returned to its pre-intervention level and is approaching its all-time high of 76.25, underscoring the difficulty authorities are having in halting its advance.
“Intervention, in order to be effective, needs to be persistent and continuous and needs to have the understanding” of other authorities, said Sakakibara, who earned the nickname because of his efforts when an official to influence the yen rate through verbal and actual intervention in currency markets. “Multilateral intervention does work but I don’t think at the moment the U.S. is willing to intervene. It will be very difficult to have a coordinated intervention.”
He says, “Intervention, in order to be effective, needs to be persistent and continuous and needs to have the understanding” of other authorities...!? Now do you understand why I call this guy a clown? When has intervention ever been effective for more than a few weeks?
I've written many times about how these fools never learn.
OK, mister high and mighty "Mr. Yen" let's look at what your yen interventions have done since 1996 to today. They say a picture speaks a thousand words, so I'll just show a graph:
CLICK ON IMAGE FOR LARGER VIEW
In 1996, the average yen to dollar rate was about 106 yen to $1 USD.
Today it is ¥76.82 per $1 USD - about a 30% increase in the yen. I suppose this says volumes about how effective these interventions to weaken the yen have been.
I'm sure we will hit ¥75 to $1 US Dollar... The question is how many more interventions and wasted tax monies do the Japanese public have to suffer before that happens?
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