Datastream

Equity Purchases by the Bank of Japan Reach a New Milestone

Published

4 months ago

December 21, 2020

Marcus Lu

Bank of Japan Equity Purchases

The Briefing

Domestic equities held by the Bank of Japan (BoJ) reached $434 billion in November 2020, the highest value ever recorded on its balance sheet
The BoJ began buying equity ETFs (exchange-traded funds) in 2010 to help stabilize its economy
The BoJ has now surpassed the country’s Government Pension Investment Fund as the largest owner of Japanese stocks

Equity Purchases by the Bank of Japan Reach a New Milestone

The Bank of Japan (BoJ) increased its equity holdings to $434 billion in November 2020, surpassing Japan’s Government Pension Investment Fund to become the country’s largest holder of domestic stocks.

This milestone will likely capture the attention of global policymakers, as the BoJ is the only central bank to purchase equities—a practice it first began in 2010. These purchases were intended to stabilize the Japanese economy after the 2008 financial crisis, but have carried on ever since.

Why Does the Bank of Japan Purchase Equities?

For decades, Japan has experienced a stubbornly low rate of economic growth relative to its peers. Despite the BoJ’s best efforts to boost growth, this trend has continued after the events of 2008.

Year	Japan (% GDP growth)	South Korea (% GDP growth)	U.S. (% GDP growth)
2010	4.2%	6.8%	2.6%
2011	-0.1%	3.7%	1.6%
2012	1.5%	2.4%	2.3%
2013	2.0%	3.2%	1.8%
2014	0.4%	3.2%	2.5%
2015	1.2%	2.8%	2.9%
2016	0.5%	2.9%	1.6%
2017	2.2%	3.2%	2.4%
2018	0.3%	2.9%	2.9%
2019	0.6%	2.0%	2.2%
Average	1.28% 🇯🇵	3.31% 🇰🇷	2.28% 🇺🇸

Source: World Bank

No stranger to unconventional policies, the BoJ believes its equity purchases will add a sense of security to the stock market, and as a result, encourage greater levels of investment. Since these purchases began, the Nikkei 225, an index tracking 225 large Japanese corporations, has generated a total return of roughly 160%.

A Drop in the Pond

While $434 billion in equities is by no means a small amount, it pales in comparison to the BoJ’s total assets of $6.7 trillion. This includes $5.1 trillion in Japanese government debt, and $59.4 billion in domestic corporate bonds.

These figures fall in line with other central banks including the U.S. Fed, which currently has $7.4 trillion in assets on its balance sheet. Whether the Fed will also begin purchasing equities, however, remains to be seen.

Where does this data come from?

Source: NLI Research Institute, 2020
Notes: Data as of Nov. 30, 2020.
Figures based on a conversion rate of 1 JPY = 0.0096 USD.

Related Topics:central bank equity economic growth bank of japan monetary policy asset purchases expansionary

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Datastream

Visualizing Earth’s Global Ice Loss Between 1994-2017

In just over two decades, the planet has seen 28 trillion tonnes in global ice loss. 58% of this ice loss occurred in the Northern Hemisphere.

Published

9 hours ago

April 10, 2021

Iman Ghosh

The Briefing

Due to global warming, 28 trillion tonnes of ice have melted in just over two decades
Over half (58%) of this global ice loss occurred in the Northern Hemisphere

Visualizing Earth’s Global Ice Loss Between 1994-2017

Nearly 70% of the Earth’s freshwater is locked up in glaciers and ice caps, ground ice, and permafrost. However, this ice is melting at an unprecedented rate.

Based on data from a new scientific survey, this visualization reveals that 28 trillion tonnes of Earth’s ice has been lost between 1994 and 2017.

How Much Ice Is Being Lost Exactly?

Figures at such scales can be difficult to wrap our heads around. For the record, one billion tonnes of water is equal to 400,000 Olympic swimming pools.

It’s then a bit easier to comprehend why, when multiplied tens of thousands of times, this much melted ice—specifically, grounded ice—has resulted in global sea levels rising by 34.6mm on average.

Cryosphere category	Ice type	Change (1994-2017)
Arctic sea ice	Floating	7.6 trillion tonnes
Antarctic ice shelves	Grounded	6.5 trillion tonnes
Mountain glaciers	Grounded	6.1 trillion tonnes
Greenland ice sheet	Grounded	3.8 trillion tonnes
Antarctic ice sheet	Grounded	2.5 trillion tonnes
Southern Ocean sea ice	Floating	0.9 trillion tonnes

Over half (58%) of the ice loss occurred in the Northern Hemisphere, from Arctic sea ice and also grounded ice previously trapped in the Greenland ice sheet.

In fact, the rate of ice loss has risen from 0.8 trillion tonnes to 1.2 trillion tonnes per year, an increase of 57% since the 1990s.

The Impacts of the Ice Meltdown

Rapidly disappearing sea ice has severe impacts on the environment, both in the short and long term:

Wildlife habitat loss
Coastal erosion
Changing ocean currents
Extreme temperatures

While rising temperatures are behind most of this historical global ice loss, it’s worth noting that lower levels of ice lead to a positive feedback loop. Less ice means less of the sun’s heat is reflected away from the Earth, instead being absorbed back and further amplifying the global warming effect.

>>Like this? Then you might like this article on Mapping Territorial Claims in Antarctica

Where does this data come from?

Source: Slater, T. et al. “Review article: Earth’s ice imbalance”, The Cryosphere (2021)
Notes: Data from the scientific survey is based on satellite observations and numerical models. The metric measure of a “tonne” (1,000kg) has been used throughout for accuracy.

Datastream

Coinbase Experiences Brisk User Growth Ahead of IPO

Coinbase, America’s largest cryptocurrency exchange, saw a 117% growth in transacting users from Q4 2020 to Q1 2021.

Published

3 days ago

April 8, 2021

Nick Routley

The Briefing

Coinbase is the largest cryptocurrency exchange in the U.S.
The company added 3.3 million transacting users in Q1 2021 – a 117% increase
$133 billion in assets were added to the platform, totalling $223 billion in Q1 2021

Coinbase Experiences Brisk User Growth Ahead of IPO

A week before its initial public offering (IPO), Coinbase reported significant user growth for the first quarter of 2021.

In a report released on April 6, the cryptocurrency exchange claimed to have an estimated 56 million verified customers in Q1 2021—that’s an additional 13 million since Q4 2020.

What is Coinbase?

Launched in 2012, Coinbase is the largest consumer-facing cryptocurrency exchange in America.

The company offers a variety of products, such as an advanced trading platform, crypto wallets for retail investors, savings accounts for institutions, and even its own stablecoin that’s backed by the U.S. dollar.

A Surge in Monthly Users and Assets

In Q1 2021, Coinbase saw a 117% increase in transacting users compared to Q4 2020, from 2.8 million to 6.1 million. That’s the highest jump in users in the last three years:

Quarter	Monthly Transacting Users	% Change
Q1 2018	2,700,000	--
Q2 2018	1,200,000	-55.5%
Q3 2018	920,000	-23.3%
Q4 2018	850,000	-7.6%
Q1 2019	800,000	-5.9%
Q2 2019	1,300,000	62.5%
Q3 2019	1,200,000	-7.7%
Q4 2019	1,000,000	-16.7%
Q1 2020	1,300,000	30.0%
Q2 2020	1,500,000	15.4%
Q3 2020	2,100,000	40.0%
Q4 2020	2,800,000	33.3%
Q1 2021	6,100,000	117.9%

In addition to its growing user base, the company also reported a 147.8% uptick in assets on the platform in the last quarter, from $90 billion to $223 billion.

Quarter	Assets Held on Coinbase	% Change
Q1 2018	$13 billion	--
Q2 2018	12.9 billion	-0.8%
Q3 2018	11 billion	-14.7%
Q4 2018	$7 billion	-36.4%
Q1 2019	$8 billion	14.3%
Q2 2019	$21 billion	162.5%
Q3 2019	$17 billion	-19.0%
Q4 2019	$17 billion	--
Q1 2020	$17 billion	--
Q2 2020	$26 billion	52.9%
Q3 2020	$36 billion	38.5%
Q4 2020	$90 billion	150.0%
Q1 2021	$223 billion	147.8%