John At The Center

http://blogs.ft.com/wolfforum/2008/12/how-to-conduct-a-quantitative-easing/

Aggregate bank reserves or money stock are poor choices, since in present circumstances they can increase by huge amounts without impacting credit or expenditure. A better choice is market credit spreads. The Bank of England’s monetary policy committee can use its regular meetings to announce its preferred levels for average market credit spreads. Bank monetary operations can enforce this decision.

By setting credit spreads at appropriate levels the bank will put a floor under market values, restore credit market liquidity and economic activity and make a handsome profit to boot.

A potential problem is the transition back to positive nominal interest rates, but this can be handled by a more permanent but less generous government-backed scheme for systemic credit insurance, such as been proposed by Laurence Kotlikoff and Perry Mehrling and myself on this forum.