According to today's Wall Street Journal:
"The Bank of Japan on Friday joined a host of European peers in setting its key short-term rate below zero. The move, long denied as a possible course by the bank's governor, came a week after the European Central Bank president indicated he was ready to launch additional monetary stimulus in March -- and days after the Federal reserve expressed new worries over market turbulence and sluggish growth overseas."
This is reminiscent of Dorothy and Toto trying to track down the Wizard of Oz in their effort to overcome the wicked witch of the East.
As devoted fans of the Wizard of Oz know well, the Wizard was largely irrelevant to the problem of dealing with the infamous wicked witch. But that didn't mean that a lot of folks were none the wiser, as the Wizard commanded quite a following, as do central banks.
How absurd is it for central banks to punish commercial banks for holding reserves by forcing the banks to pay a negative interest rate on their cash holdings? This is completely ridiculous policy, only possible in a world of make believe.
Europe and the US have passed regulations that have laid their economies to ruin and stagnation. They have enacted financial penalties on firms that hire employees. They have forced their commercial banks to lend to customers for purely political reasons.
The regulators making the decisions in Europe and the US don't like free market economics and they abhor economic success in the free market. They are constantly opining about inequality as they snuff out any opportunity for the non-wealthy to prosper. Most regulators have never been involved in the private sector. Like academics cloistered in their protected tenured environment, regulators have nothing but contempt for those who strive to improve their lives through participation in the private sector.
But much like the Wizard of OZ, central bankers and their regulatory brethren form a religious cult, unconcerned about the realities of their policies. As long as they can command the attention of the crowd, they can pretend to be doing something significant.
The problem will all of this is that it doesn't work. Economies will not produce growth if regulators stifle it. This means that folks in the bottom half of the income and wealth stratum will continue to lose ground, as their standard of living recedes back to an earlier epoch. This is a circular process. Activists push laws and regulations that make the life of the less fortunate much worse and then these same activists point to the declining living standards of the less fortunate -- declining standards that could easily be reversed if activists could find something else to occupy their attention -- like work, for example.
Central bank policy is not particularly harmful. It is just mainly irrelevant, much like the Wizard of Oz. That some people believe that central bank policy actually does something, other than employ otherwise unemployable bureaucrats, is the real harm of central bank policy discussions in the media. Such discussions ignore the real problem of an over-zealous bureaucracy that has driven the western economies to the curb and blighted the hopes and dreams of their citizenry.