On low interest rate policy

Another interesting piece of news: The longterm low interest rate policy keeps the cash in banks always at high levels. Thus drives banks to lend money in a reckless way but vulnerable to a volatile market. Consumer banking,credit cards and house loans,were the main fields banks flocked to prosper,though those sectors had been too crowded with providers.

Newly emerging businesses need capital,but due to the low interest rate environment,banks cannot afford to risk lending money to those venturing enterprises and ideas,which may bear bigger possibilities of default,and may probably be tomorrow's competative edges.

Banks barely profit from a sheer difference between the lending rate and depositing rate in Taiwan,causing them fear to lend money to corporations venturing to develope new technologies. And that has harmed the island,making local industries incapable of adjusting to the R&D-led knowledge economy,and has been threw behind by other nations elsewhere,like Korea.

To be or not to be,it is a question. To abandon a low interest rate policy and instead implement a relative high interest rate one is something we can think about and will be a topic expected to be hotly debated.