My Currency is Weaker Than Your Currency: Japan vs Switzerland

The Swiss National Bank (SNB) has entered with unprecedented force
Just wow.  The SNB has pegged its currency to the EUR at a 1.2 level and then issued a statement to the world basically saying that they were gonna defend it.  We can debate free-market mechanisms blah blah all you want, the fact is that the world will accept this policy without putting up a fight whatsoever.  The SNB deserves respect in that it has made its policy clear and unequivocal:  the Bank of Japan may need to do the same, and soon.

National Sovereignty Trumps Economic Theory
We cannot create a list that is long enough to sufficiently describe all of the times that governments have intervened in the national interest.  France, S Korea, China, Japan, you name it.  When it occurs, people put up half-hearted arguments, to no avail, largely because every government doesn't want to throw away a card that it may need to use at some point in the future.

Governmental Fiat on Trial
The issue here is that currency intervention is dicey at the minimum, highly suspect at the mean, and a guaranteed disaster at worst.  There are two "safe haven" currencies at the moment, CHF and JPY.  The world has flocked out of every other currency into those two.  Both the SNB and Bank of Japan have intervened, in size, to no avail, by attempting to talk the market down, and by intervening in markets on a sporadic basis.
In the past this has worked to some degree.  However, that presumed that government policies were not ridiculed as they are now.  The US and European Community has cemented that fate, as their policies have proved to be ineffective, or worse, have been the subject of endless political wrangling.  The result: governmental fiat itself is challenged.  Thus, the endless demand for gold, the sovereign-less currency (sorry Ben, if it walks like a currency and talks like a currency, it's a currency), persists.  Put it this way, the most volatile credit derivatives position on Wall Street is now developed nations' sovereign credit, due to the sheer size x volatility.  That should tell you all you need to know.

Dear Asian Neighbors:  Strengthen Your Currencies or ELSE, Love BOJ
The real untold story at this point is the fact that the Bank of Japan shouldn't be buying US dollars.  It should go around to the other regional currencies and start buying all of them.  In size.  That would be far more effective in improving Japan's competitive position.  Toyota and Honda aren't getting beat by Ford/GM.  They are getting absolutely CANED by Hyundai.  The competition for Japan Inc doesn't come from the US: it comes from Singapore, Taiwan, South Korea, Thailand, Malaysia, etc.  Maybe these countries will protest.  However, it is more likely that they will fold, given the fact that none of their track records allow them to complain too loudly.  In short, Japan should take a page out of the SNB playbook, get on the phone, and call the Asian central banks.  That would be a far better use of the Japanese Yen.