Fed rate to Zero and what to expect

FT.com / Columnists / Martin Wolf - ‘Helicopter Ben’ confronts the challenge of a lifetime

‘Helicopter Ben’ confronts the challenge of a lifetime

By Martin Wolf

Published: December 16 2008 20:01 | Last updated: December 16 2008 20:01

Central banks may soon resort to their most powerful weapons against deflation: the printing press and the “helicopter drop” of money. It is a time for which Ben Bernanke, chairman of the Federal Reserve, has long prepared. Will this weaponry work? Unquestionably, yes: used ruthlessly, it will eliminate deflation. But returning to normality thereafter will prove far more elusive.

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