As most people at the symposium would appreciate, the reality is more complicated than this, not least because weak growth in output and incomes is largely reflecting structural factors. Another element of the reality we face is that monetary policy is just one of the levers that are potentially available for managing the economy.
Indeed, with fiscal sustainability under pressure, fiscal multipliers can turn negative and a fiscal expansion can induce higher precautionary saving and, consequently, an economic contraction. This underlines the importance of reducing debt levels, and of having effective tools to counter serious downturns in the future.