Datastream
Equity Purchases by the Bank of Japan Reach a New Milestone
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.
Economy
Charted: Public Trust in the Federal Reserve
Public trust in the Federal Reserve chair has hit its lowest point in 20 years. Get the details in this infographic.

The Briefing
- Gallup conducts an annual poll to gauge the U.S. public’s trust in the Federal Reserve
- After rising during the COVID-19 pandemic, public trust has fallen to a 20-year low
Charted: Public Trust in the Federal Reserve
Each year, Gallup conducts a survey of American adults on various economic topics, including the country’s central bank, the Federal Reserve.
More specifically, respondents are asked how much confidence they have in the current Fed chairman to do or recommend the right thing for the U.S. economy. We’ve visualized these results from 2001 to 2023 to see how confidence levels have changed over time.
Methodology and Results
The data used in this infographic is also listed in the table below. Percentages reflect the share of respondents that have either a “great deal” or “fair amount” of confidence.
Year | Fed chair | % Great deal or Fair amount |
---|---|---|
2023 | Jerome Powell | 36% |
2022 | Jerome Powell | 43% |
2021 | Jerome Powell | 55% |
2020 | Jerome Powell | 58% |
2019 | Jerome Powell | 50% |
2018 | Jerome Powell | 45% |
2017 | Janet Yellen | 45% |
2016 | Janet Yellen | 38% |
2015 | Janet Yellen | 42% |
2014 | Janet Yellen | 37% |
2013 | Ben Bernanke | 42% |
2012 | Ben Bernanke | 39% |
2011 | Ben Bernanke | 41% |
2010 | Ben Bernanke | 44% |
2009 | Ben Bernanke | 49% |
2008 | Ben Bernanke | 47% |
2007 | Ben Bernanke | 50% |
2006 | Ben Bernanke | 41% |
2005 | Alan Greenspan | 56% |
2004 | Alan Greenspan | 61% |
2003 | Alan Greenspan | 65% |
2002 | Alan Greenspan | 69% |
2001 | Alan Greenspan | 74% |
Data for 2023 collected April 3-25, with this statement put to respondents: “Please tell me how much confidence you have [in the Fed chair] to recommend the right thing for the economy.”
We can see that trust in the Federal Reserve has fluctuated significantly in recent years.
For example, under Alan Greenspan, trust was initially high due to the relative stability of the economy. The burst of the dotcom bubble—which some attribute to Greenspan’s easy credit policies—resulted in a sharp decline.
On the flip side, public confidence spiked during the COVID-19 pandemic. This was likely due to Jerome Powell’s decisive actions to provide support to the U.S. economy throughout the crisis.
Measures implemented by the Fed include bringing interest rates to near zero, quantitative easing (buying government bonds with newly-printed money), and emergency lending programs to businesses.
Confidence Now on the Decline
After peaking at 58%, those with a “great deal” or “fair amount” of trust in the Fed chair have tumbled to 36%, the lowest number in 20 years.
This is likely due to Powell’s hard stance on fighting post-pandemic inflation, which has involved raising interest rates at an incredible speed. While these rate hikes may be necessary, they also have many adverse effects:
- Negative impact on the stock market
- Increases the burden for those with variable-rate debts
- Makes mortgages and home buying less affordable
Higher rates have also prompted many U.S. tech companies to shrink their workforces, and have been a factor in the regional banking crisis, including the collapse of Silicon Valley Bank.
Where does this data come from?
Source: Gallup (2023)
Data Notes: Results are based on telephone interviews conducted April 3-25, 2023, with a random sample of –1,013—adults, ages 18+, living in all 50 U.S. states and the District of Columbia. For results based on this sample of national adults, the margin of sampling error is ±4 percentage points at the 95% confidence level. See source for details.
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