Miyako Suda doesn’t think of her job on the Bank of Japan’s Policy Board as only talking to economists and crunching numbers.
The former economics professor also goes out into the community to talk to young people about the importance of understanding money and how to manage it.
Suda, 58, was first appointed to the nine-member board, which steers the country’s monetary policies, in April 2001.
Not only is she just the second woman to sit on the board, with her reappointment last April, she effectively became the first person to get a second five-year term under the revised Bank of Japan Law, which took effect in April 1998.
The former professor of international economics and economic theory at Gakushuin University believes her job includes making the public aware of the importance of stabilizing monetary value and consumer prices. She has given more than 20 talks to mostly young people on finance and the economy.
Knowing about money “will help people when thinking about how to lead their lives,” Suda said in a recent interview with The Japan Times.
“I used to think financial education was about educating the public about risks and returns when making an investment,” but it is more about learning how to use your money in daily life, she said.
Since monetary policy management is complex and requires significant economic knowledge to fully understand it, she sympathizes with the average person who finds it difficult to follow the bank’s operations.
However, she was astonished to find that many people don’t have a basic understanding of the flow of money or the role of the central bank.
She said that learning about American financial education — characterized by former Federal Reserve Board Chairman Alan Greenspan’s words, “No matter who you are, making informed decisions about what to do with your money will help build a more stable financial future for you and your family” — was an eye-opener.
The professor-turned-policymaker likes to talk about money to children and students. She speaks mainly at universities, high schools and junior high schools nationwide.
She tries to make her explanations as simple as possible, explaining to kids how a paper note can be worth 10,000 yen. She describes how the BOJ maintains the value of money by changing interest rates and through money market operations.
“If you are taught at an early age to keep one eye on the future, how to earn money and what to do with it, it will make a huge difference to your life,” Suda said. “Financial education can help cultivate” this.
Despite being the sole woman on the Policy Board after replacing Eiko Shinozuka, who became the first female board member in 1998, Suda has tried not to focus on that fact or the reason there aren’t more women on the board.
“Basically, I don’t believe women should be given preference over men just because of the fact that they’re women,” she said.
She said she is honored that she was chosen to be a Policy Board member, but, at the same time, she also feels she might have been given preference over male candidates because she is female.
“Since I have always been the only woman wherever I go, I understand that taking affirmative action is necessary to some extent,” she reckoned. “But I think we have had enough of it by now.”
When assessing monetary policy, she draws on her training as an economist to apply academic theories when analyzing the state of the economy.
“Since the economy continuously changes and is growing more complex, analyzing the current state of the economy while using economic theories as a measure helps make consistent decisions,” Suda said.
Since the start of the economic recovery last year, the media have been hanging on every remark from board members to try to determine when the BOJ will shift its policy.
The central bank ended its unconventional ultraeasy monetary policy in March after months of speculation. Now the question is when the central bank will raise interest rates, which have been kept near zero.
Brushing aside media speculation, Suda said it is not clear when the bank will raise rates, as the board’s decision is based on the analysis of shifting factors that include economic activity and price developments.
“Now that the five-year policy of quantitative easing has come to an end and (the central bank) has entered the realm of interest rate (targeting), I’ve started my second term on a new note.”
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