Well the bank of Japan was the first major economy to implement quantitative easing if I am correct.
He is expecting another round of quantitative easing in the eurozone in 2015 but doubts its level of effectiveness and that Europe may be faced with a period of low growth and low inflation similar to what Japan has experienced.
This could exacerbate social tensions and see a further rise in far right/left parties and lead to the break up of the eurozone in a more extreme scenario.
We will have to see what the countries and the ECB will do.
From a UK perspective they talk about low inflation but that is unlikely to resonate with the man in the street who has to pay his bills and has seen the cost of living increase dramatically since the onset of the financial crisis.
More QE to encourage the banks to lend is all well and good but the results are not equitably shared.
We are looking at a massive NHS funding crisis in the next few years predicted to be a 20 billion black hole around 2020 not to mention an unknown black hole in pensions further down the line.
The govt has not been able to achieve its target of eliminating the deficit during this parliament nor achieve its targets for economic growth. They were warned that cutting to much to fast could hamper our long term growth and this has been the case, it has created a drag on our economy.
Now more supply side nonsense about tax cuts for the rich. They need to keep the 50% rate in place and lower VAT to stimulate consumer spending and another round of QE and they might just might be able to balance the books by the end of the next parliament unless we have a recession. Basically we are not growing fast enough to pay down the deficit and further cuts could be detrimental yet we have liabilities.
The scary thing is the uk economy is growing faster than most others. If inflation is so low and we are worried about deflation then why not stimulate the economy?
The national debt? We are not paying down the national debt now, it is growing by 2 billion pounds a week! Without economic growth we are fubar, we cant eliminate the deficit, the electorate won't stand for a 20 billion black hole in NHS spending when the govt can find 65 billion to bail out banks.
Lord Turner may be right that more 'radical' policies may be needed.
Yeah Japan did try it, but they stopped, and then thanks to corp profits, their currency strengthened rapidly.
I don't like the EU, but I thought it was despite the differences between countries' and their systems', was working. The low or no growth is going to test the EU greatly.
Sometimes, I wonder if not QE, why not just old fashion print some money? As, you guys WANT inflation, and it could, if used correctly benefit the regular people as well.
Austerity was too much too soon. Yes, you don't want massive deficits, but don't sink the ship to drown a rat. I wonder if the UK will recover enough to close it's account deficits. Seems like this is the future for many developed countries. Basically a race between your pop falling, and being able to pay out public pensions and NHS.
I honestly see some seriously radical groups emerging in the Euro zone, as you guys have some serious hacks running the show. Almost like the living version of the Obama charactures that the right wing has, are running things.