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Ben Bernanke realised printing yet more money would look desperate - Telegraph
The reality is QE has already done an awful lot of damage. America has expanded its base money supply three-fold in two and a half years – from 6pc to 18pc of national income. But even this jaw-dropping measure hasn't led to much of an expansion in monetary measures, such as M2 that include bank lending, precisely because the banks, for all the propaganda to the contrary, are still determined not to lend. They can make more money simply channelling QE money into stocks and other investments.Crucially, the banks also remain petrified of counter-party risk in the inter-bank market. Many of them, disgracefully, are still concealing vast sub-prime losses in off-balance-sheet vehicles. So they assume other banks are doing the same. Such mistrust between the banks – "we're lying, so they must be lying" – gums up the wheels of finance and starves even creditworthy firms of the funds needed to invest and create jobs.

zombi banks - same as japan +10 years ago.
transparency  Fed  benbernanke  2011  JacksonHole  QE  QE3  QE2  quantitative  easing  ZIRP  M2  moneysupply  monetary  policy  inflation  deflation  USA  UK  monetarybase  interbank  LIBOR  trust  confidence  toxicassets  subprime  zombi  banks  company  capitalism  fiatmoney  politics  barackobama  presidency  GeorgeOsborne  davidcameron  greatrecession  recovery  lostdecade  Japan  balancesheet  recession  richardkoo  deleveraging  debtoverhang  sovereign  debt  crisis  centralbanks  trichet 
august 2011 by asterisk2a

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