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To: Zeev Hed who wrote (12411)	12/27/1997 12:13:00 PM
From: Defrocked	Respond to of 18056

BOJ now holds 40% of outstanding CP in Japan. Adding liquidity and doubling creditor role over last year. <snip> "As of Friday, the balance of CP bought from the market and held by the BOJ came to 4.6 trillion yen, up from 2.7 trillion yen in early 1996. The holdings account for 40% of some 11 trillion yen in outstanding CP issued by companies, financial sources said." <snip> Full Story: satellite.nikkei.co.jp Raises additional questions in my mind: (1)Applies the concept of "Too big to fail" to the corporate sector, no?? (2)Why is the BOJ disintermediating the banks and financial markets with direct purchases of CP??? (3)Doesn't this further distort credit premiums in Japan??? (4)Can you imagine the Fed directly buying up 40% of the US commercial paper market with tax payer money??? (5)Does this in any way increase transparency??? FWIW,from a patient and conservative investor.