Washington politicians are pointing the U.S. economy straight into a liquiditytrap and instead of a bright economic future, the U.S. is looking at years of high unemployment, weak GDP growth and the possibility of widespread deflation.
Recall that a Keynesian liquiditytrap occurs at the point when interest rates become so low that cash balances are passively held regardless of their size.
Monetarists and other non-Keynesians believed that further expansion of money and related credit aggregates would stimulate the economy further even if interest rates were stuck in a liquiditytrap.