Richard Werner

1967 – ? German economist

The economist who coined the term quantitative easing and wrote Princes of the Yen.

Affiliations: Professor of banking and economics; developed the quantity theory of credit.

Richard Werner is a German economist known for coining the term quantitative easing in Japan in the mid-1990s and for his quantity theory of credit, which argues that the direction of bank credit creation drives economies. His 2003 book Princes of the Yen argued that the Bank of Japan engineered the 1980s bubble and the long recession that followed to force structural change.

In the timeline

900 – 999 Sung Dynasty launches the world's first paper money author of the source
1200 – 1299 Marco Polo in Kublai Khan's China author of the source
1875 Foundation of the Reichsbank author of the source
1900 United States overtakes Britain economically author of the source
1908 Havenstein becomes Reichsbank president author of the source
1913 Founding of the U.S. central bank author of the source
1913 Founding of the U.S. Federal Reserve author of the source
1920 – 1945 Wartime consolidation of Japanese banks author of the source
1922 – 1923 German hyperinflation under the Reichsbank author of the source
1922 – 1939 Reichsbank independence written into law author of the source
1923 Schacht appointed Reichsbank president author of the source
1924 Reichsbank made independent after hyperinflation author of the source
1924 – 1930 Schacht's reign as Reichsbank president author of the source
1924 New banking law confirms Reichsbank independence author of the source
1924 – 1931 Reichsbank credit tightening and credit crunch author of the source
1927 Japanese banking crisis of 1927 author of the source
1929 New York stock market crash of 1929 author of the source
1929 U.S. deposit withdrawals throw Germany into depression author of the source
1930 – 1939 Japanese military fitness survey of the early 1930s author of the source
1930 The Great Depression and the Fed's inaction author of the source
1931 Manchuria placed under direct army rule author of the source
1932 Foreign exchange control laws of 1932 author of the source
1932 – 1942 Joseph Grew serves as U.S. ambassador to Japan author of the source
1933 – 1939 Schacht reappointed head of the Reichsbank under Hitler author of the source
1933 – 1937 Reichsbank's monetized fiscal policy under Schacht author of the source
1936 Hirota cabinet puts economy on quasi-war footing author of the source
1937 Full-scale war with China begins author of the source
1937 Konoe cabinet promulgates three wartime control laws author of the source
1937 Cabinet Planning Board established author of the source
1937 – 1945 Wartime transformation of the Japanese economy author of the source
1937 Temporary Funds Adjustment Law author of the source
1938 National General Mobilization Law author of the source
1938 Industrial Patriotic Societies established author of the source
1938 – 1939 Wartime health insurance laws author of the source
1938 National Savings Promotion Campaign launched author of the source
1939 Dividend increase permits required author of the source
1939 Hitler dismisses Schacht and nationalizes the Reichsbank author of the source
1939 Reichsbank renamed and subordinated to the Reich government author of the source
1940 Proclamation of the New Economic Order author of the source
1940 Industrial Standardization Law author of the source
1940 – 1950 Wartime switch to bank funding author of the source
1942 Bank of Japan Law of 1942 author of the source
1942 Workmen's Annuity and Insurance Law author of the source
1942 National Financial Control Association established author of the source
1942 – 1991 Credit quantity as BoJ's central policy tool, 1942-1991 author of the source
1943 Munitions Corporation Law promulgated author of the source
1943 Creation of the Munitions Ministry author of the source
1944 Share dividends capped at 5 percent author of the source
1944 – 1945 Creation of the main bank system author of the source
1945 Japan's defeat in World War II author of the source
1945 – 1952 U.S. occupation of Japan author of the source
1945 Occupation Order No. 3 continues economic controls author of the source
1945 Munitions Ministry and Home Ministry broken up author of the source
1945 Araki appointed BoJ deputy governor, then governor author of the source
1945 MacArthur arrives at Atsugi; BoJ money accepted author of the source
1946 Purge of the zaibatsu families author of the source
1946 Ichimada appointed Bank of Japan governor author of the source
1946 – 1952 Economic Stabilization Board established author of the source
1946 Bank of Japan freezes loan balances author of the source
1946 Araki indicted by war crimes prosecutors and resigns author of the source
1946 – 1954 Ichimada rules the BoJ for eight and a half years author of the source
1946 – 1952 Temporary Materials Ordinance and Price Control Ordinance author of the source
1946 Nationalization of the Bank of England author of the source
1947 U.S. reverse course on occupation policy author of the source
1947 Anti-Monopoly Law enacted author of the source
1947 Reconstruction Finance Bank established author of the source
1947 Priority lending regulations of 1947 author of the source
1947 Emergency Measures Law of March 1947 author of the source
1947 – 1949 Temporary Law for Credit Allocation enacted and rescinded author of the source
1947 Temporary Interest Rates Adjustment Law reintroduced author of the source
1948 Deconcentration program abandoned author of the source
1948 Occupation restricts trade-based unions author of the source
1948 Nine-Point Economic Stabilization Program author of the source
1949 – 1998 Foreign Exchange and Foreign Trade Control Law author of the source
1949 Dodge mission and the Dodge plan author of the source
1949 Bank of Japan Policy Board introduced author of the source
1949 Bank of Japan Policy Board established author of the source
1949 Yen fixed at 360 per dollar author of the source
1950 – 1951 Postal-savings-funded government banks created author of the source
1952 Enterprise Rationalization Promotion Law author of the source
1952 Araki appointed ambassador to the United States author of the source
1953 Anti-Monopoly Law watered down author of the source
1954 Abolition of the Loan Coordination Division announced author of the source
1954 Ichimada becomes Minister of Finance author of the source
1954 – 1956 Araki returns as BoJ governor author of the source
1954 – 1958 Ichimada serves as finance minister author of the source
1955 – 1993 Formation of the Liberal Democratic Party author of the source
1955 Japan joins GATT author of the source
1955 Commercial Law Article 280 amended author of the source
1956 Government committee established to review Bank of Japan Law author of the source
1957 – 1972 Kishi and Sato premierships author of the source
1957 – 1972 Premierships of Kishi and Sato author of the source
1958 Committee recommends monetary policy freedom for the BoJ author of the source
1958 BoJ publicly abolishes window guidance author of the source
1960 Finance Minister Sato declines to revise the BoJ Law author of the source
1960 Ikeda becomes prime minister with the income doubling plan author of the source
1960 U.S.-Japan Security Treaty pushed through the Diet author of the source
1961 First round of Japanese trade liberalizations author of the source
1962 Sasaki becomes de facto head of the Bank of Japan author of the source
1963 Emergency Financial Order repealed author of the source
1964 BoJ reintroduces window guidance to slow the economy author of the source
1965 Run on Yamaichi Securities and forced BoJ rescue author of the source
1965 Window guidance abolished again author of the source
1965 First postwar Japanese government bonds issued author of the source
1966 Cross-shareholding program completed author of the source
1966 – 1982 Tight Bundesbank policy linked to fall of three chancellors author of the source
1967 German parliament passes the Stability and Growth Act author of the source
1967 – 1969 Window guidance reintroduced and expanded author of the source
1970 – 1979 Japan's first postwar bubble economy author of the source
1970 Japan becomes the world's second-largest economy author of the source
1970 Zenith files dumping suit against Japanese television makers author of the source
1971 End of the Bretton Woods system author of the source
1971 Nixon shock ends dollar-gold convertibility author of the source
1971 Smithsonian Agreement fixes the yen at 308 per dollar author of the source
1972 – 1973 Japan's first bubble economy in land and stocks author of the source
1972 Karl Schiller forced out over Bundesbank dispute author of the source
1973 Oil shock hits Japan author of the source
1973 – 1975 BoJ imposes tight window guidance to end the credit boom author of the source
1974 Inflation peaks with 26 percent consumer price rise author of the source
1974 – 1975 Japan sinks into its biggest postwar recession author of the source
1974 Bank runs on credit associations author of the source
1974 Alternating MoF-BoJ governorship tradition begins author of the source
1975 Fiscal stimulus packages fail to revive the economy author of the source
1975 – 1978 Mieno heads the BoJ Banking Department author of the source
1976 Industrial production recovers after BoJ loosens credit author of the source
1977 Noguchi and Sakakibara publish 'Analysis of the MoF-BoJ Kingdom' author of the source
1978 Bank of Japan introduces monetary targeting author of the source
1978 BoJ declares tighter quantitative control author of the source
1979 MITI's 'samurai plan' aircraft leasing scheme author of the source
1979 Swiss central bank briefly imposes negative rates author of the source
1980 – 1989 Central banks abandon monetary targets author of the source
1980 Benchmark revision of the foreign exchange law author of the source
1980 – 1991 Window guidance operated continuously through the 1980s author of the source
1980 Japan liberalizes capital flows author of the source
1981 U.S.-Japan Wise Men's Group calls for open Japanese markets author of the source
1981 BoJ announces abolition of window guidance controls author of the source
1982 Liberalization of gold transactions author of the source
1982 – 1987 Federal Reserve abandons monetary targeting author of the source
1983 Sasaki calls for a five-year plan to transform Japan's economy author of the source
1983 – 1987 Sasaki and Maekawa reports on structural reform author of the source
1984 – 1989 Ex-MoF vice minister Sumita serves as BoJ governor author of the source
1984 BoJ announces complete abolition of window guidance author of the source
1984 Maekawa hands over BoJ monetary policy control to Mieno author of the source
1985 – 1989 Japanese asset price bubble inflates author of the source
1985 – 1987 Yen rises 106 percent author of the source
1985 Endaka recession author of the source
1985 Nakasone forms the Maekawa advisory group author of the source
1985 Deposit interest rate deregulation begins author of the source
1986 – 1990 Japanese capital floods world markets author of the source
1986 Japan buys three-quarters of U.S. Treasury auctions author of the source
1986 Banks aggressively expand credit creation author of the source
1986 Window guidance quotas tightened amid land price surge author of the source
1986 – 1987 BoJ orders banks to expand lending during the bubble author of the source
1986 – 1989 Fukui heads the Banking Department during the bubble author of the source
1986 Mieno warns the Diet about excess money author of the source
1986 Maekawa report submitted to the prime minister author of the source
1987 Record Japanese long-term capital outflows author of the source
1987 – 1989 Official discount rate held at 2.5 percent author of the source
1987 Executive Board cuts the discount rate to 2.5 percent author of the source
1987 Fukui defends expanding bank loans in Nikkei interview author of the source
1987 Second Maekawa report announced author of the source
1987 Fukui endorses continued monetary easing to implement structural reform author of the source
1987 Window guidance extended to foreign-currency loans author of the source
1988 Asymmetric cross-border acquisitions of 1988 author of the source
1988 – 1989 Window guidance begins tightening before Mieno's governorship author of the source
1988 Third Maekawa report announced author of the source
1989 Yasushi Mieno becomes Bank of Japan governor author of the source
1989 Peak of the Japanese asset bubble author of the source
1989 End of the Showa era author of the source
1989 Nikkei peaks at all-time high of 38,915 author of the source
1989 Bubble lending reaches 27 percent of all bank loans author of the source
1989 Banks suddenly restrict loan growth author of the source
1989 – 1994 Mieno becomes BoJ governor author of the source
1989 Mieno's 'Christmas present' rate hike ends the bubble author of the source
1989 BoJ tightens window guidance and ends the bubble author of the source
1989 Death of Haruo Maekawa author of the source
1989 Mieno appointed governor of the Bank of Japan author of the source
1989 – 1990 Structural Impediments Initiative author of the source
1990 Collapse of the Japanese bubble author of the source
1990 Japan becomes the world's top direct investor author of the source
1990 Unemployment hits record low of 2 percent author of the source
1990 – 1994 Asset prices collapse and the bust begins author of the source
1990 Nikkei falls 32 percent in one year author of the source
1990 – 1999 Decade of fiscal stimulus packages author of the source
1990 Mieno publicly defies the Finance Ministry author of the source
1990 Ministry of Finance total volume regulation of bank lending author of the source
1991 Japan becomes a net capital importer author of the source
1991 Japanese foreign investment tide reverses author of the source
1991 Japan slides into its longest postwar recession author of the source
1991 BoJ begins cutting the official discount rate author of the source
1991 – 1992 U.S. recession of 1991 and rapid Fed reflation author of the source
1991 BoJ announces immediate abolition of window guidance author of the source
1991 EMEAP central bank club formed author of the source
1991 Bank of Japan declares window guidance abolished author of the source
1991 – 1995 Bank of Japan begins 1990s rate-cutting cycle author of the source
1992 – 1999 Bank of Japan monetary contractions of the 1990s author of the source
1992 Credit crunch hits small firms author of the source
1992 – 1994 Four massive fiscal stimulus packages author of the source
1992 Bush loses reelection amid economic pessimism author of the source
1992 Maastricht Treaty lays foundations for European monetary union author of the source
1992 "One Market, One Money" study published author of the source
1992 Japan's decade of fiscal stimulation packages author of the source
1992 High-powered money contracts despite falling rates author of the source
1992 Sharp reduction in Japanese credit creation begins author of the source
1993 Mieno links the recession to structural transformation author of the source
1993 Telecommunications sector deregulated author of the source
1993 Hosokawa administration reforms the electoral system author of the source
1993 Rice market forced open author of the source
1993 Thailand deregulates capital account and creates the BIBF author of the source
1993 – 1996 Surge of private capital inflows into Asia author of the source
1993 Japan's 1993 rice crisis author of the source
1994 – 1995 Credit creation turns negative and nominal GDP shrinks author of the source
1994 – 1995 Record foreign exchange intervention to weaken the yen author of the source
1994 Matsushita appointed governor with Fukui as deputy author of the source
1994 Mieno retires and lobbies for a new Bank of Japan Law author of the source
1995 Yen hits postwar high of 79.75 author of the source
1995 Yen surges to around 80 per dollar author of the source
1995 Yen hits historic high of 79.75 per dollar author of the source
1995 Unemployment reaches a postwar high author of the source
1995 Japan's overseas production exceeds exports author of the source
1995 Far-reaching deregulation package announced author of the source
1995 Product liability law favors consumers author of the source
1995 – 1998 First Japanese bond bubble author of the source
1995 Richard Werner coins 'quantitative easing' originator
1995 Werner coins 'quantitative easing' as a way out mentioned
1996 Brief recovery of 1996 author of the source
1996 Big Bang financial deregulation conceded author of the source
1996 Landmark EMEAP governors meeting in Tokyo author of the source
1996 Greenspan's irrational exuberance speech author of the source
1996 Tokyo High Court rules against bid-rigging author of the source
1997 New Bank of Japan Law proposed author of the source
1997 Asian financial crisis author of the source
1997 Bill to revise the Bank of Japan Law submitted author of the source
1997 – 1998 BoJ reorganizes its credit control departments author of the source
1997 – 1998 Revised Bank of Japan Law passed author of the source
1997 – 1998 Asian currency crisis erupts author of the source
1997 Thai baht crisis breaks in Bangkok author of the source
1997 Thai finance minister seeks Japanese help in Tokyo author of the source
1997 Washington blocks Japan's Asian Monetary Fund proposal author of the source
1997 Hashimoto administration's 1997 structural reforms author of the source
1997 – 1998 Post-reform contraction of 1997-98 author of the source
1998 Bank of Japan independence and creation of the FSA author of the source
1998 Yen collapses to nearly 147 per dollar author of the source
1998 BoJ sharply boosts credit creation author of the source
1998 New Bank of Japan Law makes the BoJ independent author of the source
1998 Ministry of Finance stripped of its powers author of the source
1998 Fukui resigns with Governor Matsushita author of the source
1998 Prosecutors raid the Ministry of Finance author of the source
1998 Financial Supervisory Authority opens and closes LTCB and NCB author of the source
1998 Big Bang begins with foreign exchange deregulation author of the source
1998 Bank of Japan begins rapid money creation author of the source
1998 Bank of Korea reflates sharply author of the source
1998 Russia defaults on domestic debt author of the source
1998 Mahathir imposes capital controls in Malaysia author of the source
1998 New York Fed organizes LTCM bailout author of the source
1998 Bank of Japan stops publishing sectoral loan data author of the source
1998 Call rate lowered to near zero author of the source
1998 Bank of Japan granted independence author of the source
1998 Big Bang financial deregulation begins author of the source
1998 Japanese suicides peak amid recession author of the source
1998 Hayami becomes BoJ governor after 1998 resignation scandal author of the source
1999 Zero interest rate policy introduced author of the source
1999 – 2001 Short-lived recovery of 1999 and relapse author of the source
1999 BoJ credit withdrawal strengthens the yen despite record interventions author of the source
1999 Bank of Japan withdraws credit in 1999 author of the source
1999 Public money injected into Japanese banks author of the source
1999 Asian leaders call for currency union author of the source
1999 European Central Bank begins operations author of the source
1999 Tax money injected into Japanese banks author of the source
1999 Omnibus Act abolishes cartel exemptions author of the source
1999 Zero interest rate policy adopted author of the source
2000 Hayami tightens monetary policy as the economy recovers author of the source
2001 Abolition of the Okurasho name author of the source
2001 Fukui's failed bid for the BoJ governorship author of the source
2001 BoJ shifts to expanding the quantity of credit author of the source
2001 The Okurasho loses its historic name author of the source
2001 Bank of Japan adopts quantitative easing author of the source
2001 Abolition of the Ministry of Finance (Okurasho) author of the source
2001 Japan adopts market value accounting author of the source
2001 Koizumi becomes prime minister author of the source
2001 Bank of Japan reflates under Koizumi author of the source
2001 Bank of Japan announces quantitative easing author of the source
2001 Enron bankruptcy author of the source
2001 German economy slows down author of the source
2001 Japan's national debt reaches record high author of the source
2001 Bank of Japan announces reserve targeting ('quantitative easing') author of the source
2001 Richard Werner argues the bubble was engineered by the Bank of Japan central figure
2002 Koizumi pledges an anti-deflation BoJ governor author of the source
2002 BoJ announces stock purchases; Yanagisawa replaced by Takenaka author of the source
2002 Surprise recovery in late 2002 author of the source
2002 Euro cash introduced; national currencies abolished author of the source
2002 ECB orders record shrinkage of Bundesbank credit creation author of the source
2003 Toshihiko Fukui appointed Bank of Japan governor author of the source
2003 The debate over what caused the lost decades mentioned
2010 The claim that Japan was crushed to clear the way for China mentioned

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