Prof. Summers says ZIRP should continue for the next decade.

In the FT this morning, Summers says:

". . . for reasons rooted in technological and demographic change and reinforced by greater regulation of the financial sector, the global economy has difficulty generating demand for all that can be produced. This is the 'secular stagnation' diagnosis, or the very similar idea that Ben Bernanke, former Fed chairman, has urged of a 'savings glut'. Satisfactory growth, if it can be achieved, requires very low interest rates that historically we have only seen during economic crises. This is why long term bond markets are telling us that real interest rates are expected to be close to zero in the industrialised world over the next decade."

So I guess that may be it. It is interesting, and to me questionable, however, that financial repression and ZIRP are compatible with financial stability in the long run, as Prof. Summers may assume.