Richard Werner, founding director of the Centre for Banking, Finance and Sustainable Development at the University of Southampton, is the man who coined the phrase “quantitative easing” in the early 1990s.

Richard tells us the banks are wrong and that there is no evidence that lowering interest rates helps the economy and that Japan is an example of the fact that this does not work. He says the interest rates actually rise as the economy expands; they do not fall. He goes on to say the way to stimulate the economy is through increased availability of credit, not messing with interest rates, and that is what he has been recommending all along.

Increasing availability of credit is more like his original definition of “quantitative easing”. It is what works according to the actual data. Yet, this is what the banks are ignoring. (Why? I wonder.)

See this very interesting you tube video Quantitative Easing: the Banks are Wrong!