Necessity of an audacious monetary policy

It is important for us to learn from the failure of the Japanese experience in the 90s. A first lesson is certainly that the bank system has to be seriously cleared up. The Japanese financial institutions are associated with the notion of zombie banks. They survived because of the public authorities’ back-up, although they were not able to offer credit to households and companies any longer. A second lesson is that monetary policy must really be audacious.

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