The theory is simple. Circulating money means the economy is active and producing. More money circulating means more of the economy is active. More money in t

The theory is simple. Circulating money means the economy is active and producing. More money circulating means more of the economy is active. More money in the economy increases inflation because more supply lowers value. Inflation is good because it is not deflation, but it is not good because it devalues monetary assets over time. Low inflation is best. The problem is simple. The additional money from cheap loans is not circulating. It is being sunk into mortgages and other debt. The truth is that the policy is working in the sense that the alternate would have been deflation. Deflation kills retail because it is hard to stay in business if you buy low, sell lower.