Problems in Japan: Yasushi Mieno, governor of...

Problems in Japan: Yasushi Mieno, governor of the Bank of Japan, said the value of Japanese assets has become bloated as an effect of the central bank’s easy money policy in 1985-1989 and land prices should be gradually reduced. However, he noted, “We can’t adopt a monetary policy aimed at that objective alone . . . but we will continue a tight money policy until the money supply comes down to a reasonable level.” Since November, Japan’s money supply has expanded at a rate of more than 10% a month. In June, the last month for which data is available, the increase was 12.6%. A different monetary policy and a new land taxation system, which the government is now formulating, will be needed to lower land prices, he said.