Attempting to fix sclerotic, inefficient state cartel economy by boosting inflation the ultimate goal of Japan monetary is a self liquidating path to destruction. 

The Bank of Japan surprise expansion of financial stimulus strikes me as the monetary equivalent to the destruction plan of attacking Pearl Harbor. Not in the sense of launching a pre-emptive war, but in the sense of a leadership pursuing the Grand Strategy to the point of self destruction because they no alternative within their intellectual and political framework.

To restore confidence, Abe has undertaken a program of what he calls three arrows, " monetary easing to restore deflation, fiscal stimulus to boost immediate spending and a structural reform to revive long term growth. " If these three arrows are hitting their targets, there would be reasons for bullishness.

But two of the arrows have already flown wide, any stimulus from temporary spending has been more than premature tax hikes to cut government debts. Meanwhile the prospects for structural reform have not progressed beyond vague sloganeering.

That leaves just one real arrow. Monetary easing. But none of the three arrows can work without the other two. Confidence must rest on something more substantive than inflation, structural reform to Japanese companies lagging competitiveness. Would you agree, any temporary economic boost will soon give way to disillusionment? 

Disenchantment is already appearing in the Japanese stock market, which rose by 65% by Abe's ascension until the end of 2013 almost entirely on buying from foreign investors-- but as at May had lost a third of those gains by foreign investors sold. Then it comes the last real arrow.

What is needed is structural reform of the actual causes of the stagnant economy. Real political and financial reform that dismantles the structural causes Japan's failure. But such a strategy is not even discussed, much less actively considered, because it would upend the powerful elites and vested interest who benefit from the status quo Grand Strategy. 

To lift productivity, Japan needs serious structural changes to promote creative destruction, the process of replacing decaying firms with vibrant ones. The sectors of Japan economy that face international competition such as the auto industry, enjoy high productivity. But the lion's share of the economic system is domestically oriented, and much of it is shielded from international and domestic regulations and cartel- like business practices. 

Since 1997 wages in Japan has fallen 9% in actual terms. They are expected to continue falling, despite highly advertised wage hikes by a few hundred giant firms, whose profits from overseas sales have been artificially boosted by the weaker Yen.

In reality, deflation is not the principal reason for Japan's problem but a symptom. Attempting to solve Japan's malaise by generating inflation is like trying to cure fever by putting ice on the thermometer

If the reform is easy, it could accept been accomplished a long time ago. Japan will eventually reform and revive. Its tragedy is that it is filled with bright, ambitious individuals that are trapped in once vibrant but now ossified political and economic institutions.

The whole is so much less than the sum of it's parts. The state will revive when it finally undertakes the necessary institutional overhaul. But it demands a visionary leader, but maybe Mr. Abe is not the ace.

The real reformer would scrap the Japan Agriculture from the Anti-Monopoly Act  a law passed 40 years ago designed to encourage competition and use the act to crack down on such practices. Tokyo has turned a blind eye because the Japan Agriculture is a powerful electoral ally of Abe's political party. Sounds politically like in our own turf?

Playing games such as devaluing Japanese currency and monetizing Japan's ballooning debts with freshly issued money does nothing to fix the rot beneath the bright neon lights of superficial wealth.

Will this new monetary stimulus works? 

Now that the Bank of Japan is pursuing its own self destructive tragedy, and all the world can do is watching from afar and hope the eventual collapse of this Grand Strategy doesn't take the entire global financial system down with it. Specifically those innocent real economy nations. 

" In the first six months or 12 months of a war with the United States and Great Britain, I will run wild and win victory upon victory. But then if the war continues after that, I have no expectation of success " --General Yamamoto in such one voice of caution. 

In one case the global economy rolls over into contraction, Japan's fiscal and monetary bankruptcy will become apparent. 

Alas, everybody else gets destroyed along with the Elites when the system implodes. Is Malaysian Central Bank feeling comfortable with the ongoing situation at these critical moment?

Till here, then invest wisely.