I completely disagree with your assertion that you can "cure" deflation with a printing press. And how is Japan not a relevant example?
You can certainly raise prices of financial assets but when the long rates are low for so long (and are made lower by QE) there emerges a negative feedback loop of overproduction -> oversupply -> lower prices for goods, with a stronger concentration of this effect low on the value chain (CPI ex-housing). In fact, if you look at domestic and european CPI's ex-housing (European countries are ex-housing by default), you will see that the inflation rates has been nearly 0 since the financial crisis despite printing trillions of dollars. But stocks are expensive. Quote from Greenspan: "As the cost of capital approaches zero, so too will the return on capital."
And to pose another question to you: from what transmission mechanism will your printing press create inflation when long rates are already low?
>I completely disagree with your assertion that you can "cure" deflation with a printing press. And how is Japan not a relevant example?
Of course you can always “cure” deflation by printing money. If you gave me control of the printing press for a few weeks I would print up a few billion dollars for each person (or maybe just a few trillion for my friends) and give it away. You can be sure that a dollar would be worth nothing after this exercise.
To answer your second question you can’t create inflation unless you actually get the money into the hands of consumers. The central banks have not been printing and handing the money out to consumers, they have been printing and giving it to banks. If the banks don’t have anyone they want to lend to then the money just sits in the bank and has no effect on demand. If I printed off a few trillion dollars for myself and just left it in a huge vault there would be no inflation - we would only get inflation if I went out a started buying every asset under the sun.
It's important to note that they've been printing it and paying banks not to give it to consumers. Back at the start of the crisis inflation had nosedived but the most recent inflation number the Fed had still showed high inflation. They knew that they were going to have to print lots of money to support the banks so they embarked on the unprecedented Interest On Reserves program to counteract the expansionary effects. That change in the rules of the game is probably a good part of why the Fed's models were so badly off during the crisis.
You can have negative interest rates (Switzerland and Sweden currently have them) so the zero lower bound does not need to exist. Of course monetary stimulus only works if the banks decide to actual lend all this cheap money. If they don’t then the money just piles up on their balance sheet and has no effect on aggregate demand.
Sweden has negative rates when loaning in money, not when loaning out money. That is, they are not violating the zero lower bound - they are simply a bit closer to it.
The Swedish negative rates are for banks borrowing from the central bank, but in theory there is nothing stopping banks lending money to individuals at a negative interest rate. In a deflationary environment such loans will still have a positive real interest rate. The banks of course would only do so if the negative interest rate was less than what the central bank charged.
That assumes that alternative tools like Quantitative Easing are not available. Central banks don't like to engage in Quantitative Easing because it hasn't been done very often and central bank models of it aren't very precise but it has certainly had an effect when tried.
You can certainly raise prices of financial assets but when the long rates are low for so long (and are made lower by QE) there emerges a negative feedback loop of overproduction -> oversupply -> lower prices for goods, with a stronger concentration of this effect low on the value chain (CPI ex-housing). In fact, if you look at domestic and european CPI's ex-housing (European countries are ex-housing by default), you will see that the inflation rates has been nearly 0 since the financial crisis despite printing trillions of dollars. But stocks are expensive. Quote from Greenspan: "As the cost of capital approaches zero, so too will the return on capital."
And to pose another question to you: from what transmission mechanism will your printing press create inflation when long rates are already low?
Like another poster below, I suggest reading the material at http://www.economicprinciples.org/