What next for Japanese economic policy?

Abeconomics is taking over the imagination of global investors. The Nikkei is up over 25%  since it has first been mentioned and the yen has declined over 205. The policy talk is to get to 2% inflation but how is it going to get done. First, deflation expectations are very sticky and nominal interest rates are high so real rates are positive. Second, the economy is not going to respond if the BOJ cannot get real rates negative. 

Given forward guidance will not be enough to solve the problem, there has to be a bold move to helicopter money, policy talk like the ECB of saying that the BOJ will do whatever it takes, a floor against yen at some higher level, direct purchases of loans. 

Still, there will also be a need to solve the ongoing balance sheet recession whereby private business have not borrowed money and corporate savings is way too high. In this case fiscal stimulus is needed to step-in where the private system does not seem to work. This is classic Keynesian economics at zero rates. Here the argument is that the fiscal multiplier will work. Finally, there has to be structural reform to make it difficult to hold corporate savings. Money alone is not enough for Abenomics.