[quote=carlsbadworker]
The reason that Japan had 0% rates but it still has deflation is because the famous phenomenon known as “carry-trade”. The rest of the world’s economy was booming at that time. So naturally, people took money from Japan central bank and invested it elsewhere. So the printing press does not work as a tool to fight deflation over there.
[/quote]
Actually, Japan’s low rates didn’t translate to an increase in the money supply. And they didn’t start quantitative easing (central banker euphemism for money printing) until 2001 — ie a decade after the bust started. So as far as the “printing press” goes, Bernanke and crew have already done what it took Japan over a decade to do.
