What was the “role” of the Bank of Japan governor during the deflationary recession? Reading Kuroda Haruhiko’s (黒田東彦) memoir, “Monologue: The Battle Against Deflation” (Real Sound)

Based on the memoir “Monologue: The Battle Against Deflation: The Truth About 10 Years of Quantitative and Qualitative Easing and Price Stability” (Kobunsha), the book portrays Bank of Japan Governor Kuroda Haruhiko’s (黒田東彦) views on overcoming deflation and the role of the Bank of Japan. Through episodes about his friendship with Shiokawa Masajuro (塩川正十郎) when Kuroda was serving as a finance ministry official, Kuroda touches on Shiokawa’s deep understanding of his role as a politician.

Shiokawa served as Minister of Finance in 2001. When Kuroda accompanied him on a visit to the United States, Shiokawa explained his administration’s policy in his own words rather than simply explaining the briefing materials, and O’Neill was described as having expressed his appreciation for Shiokawa’s remarks. Kuroda recalls that this episode revealed Shiokawa’s approach to understanding his “role.”

In remarks shortly after taking office, Kuroda pointed out that the Japanese economy had been suffering from 15 years of deflation since 1998, and that if a central bank’s mission was price stability, the Bank of Japan might not have fulfilled it. He stressed that the central bank’s role was to maintain price stability over the long term and recognised that overcoming deflation was the Bank of Japan’s responsibility.

The book also discusses how Kuroda limited the period during which he wrote prepared remarks as governor, as well as policy ideas such as the “Triple 2” proposed at a press conference when he took office. It concludes by noting similarities with Shiokawa’s words that “the president’s job is to give greetings.”