[What keeps the US and the world economy afloat at a time when US balance of payments and budgetd eficits have soared to unprecedented levels? As The Economist noted in its September 23, 1999 edition, “Never before in history have central banks wielded so much power.” That power has only increased, as central governments continue to withdraw from economic management by reducing redistributive taxes, transfers and regulations, thus leaving even more decisions to central banks, the market and lower levels of the state. As central bankers become more influential, it is reasonable to ask what lies behind their decisionmaking and how they might be held more accountable. The long series of asset bubbles over the past decade suggests that there is something fundamentally wrong in the governance of the financial side of the economy. This is the context for Richard Duncan's analysis of the strategy of Japanese and Chinese central banks in underwriting US deficits. Duncan takes no position on the larger debate over central bank governance, but instead offers a fascinating, speculative glimpse into their decisionmaking processes. Duncan asks whether it is possible that central bankers in Japan and America made a political decision to coordinate their policies. Duncan concludes that central bankers stopped a spiral into deflation. From another perspective, however, unelected officials propped up the fiscal irresponsibility of the Bush regime as well as poured more froth on the worsening bubble-trouble hangover from the 1990s. Japan Focus]