Broken

In my opinion, even aside from the zero bound/liquidity trap issue, any "traditional" monetary policy is going to be a big fail because our banking system isn't really a banking system anymore. They aren't in the business of borrowing at low rates, doing some quality underwriting, and lending at slightly higher rates. They're in the gambling business. All the money stays in the shadow economy, except that which leaks out in absurd compensation packages and goosed asset prices which mostly benefit rich people as well. Free money for actual people, not the rich assholes who keep trying to destroy the world, is what's needed.

The British economy needs three things: demand, demand, demand. It needs cash in pockets and cash in tills. It does not need richer banks or easier credit lines or looser regulation. It needs that old Keynesian salve, money in circulation. If money can be showered short term on banks, it can be showered short term on consumers, whether through benefit handouts, vouchers, tax holidays or scrappage schemes. Osborne declares quantitative easing to be off his debit sheet. He can do the same for temporary boosts to the money supply.