More on QE

Here is another post by Stephanie Flanders of the BBC on quantitative easing. Paul Krugman is sceptical that simply pushing more money into the system can do anything, as you are essentially replacing one asset (cash) for another (short-term government debt) which has become a perfect substitute for it (since short-term interest rates on such debt is very close to zero). If you're buying corporate debt that is different as you are effctively taking some credit risk away from the private sector.