But ohh, it HAS!!! You are just looking in the wrong place... Basically it happens all over the world, what is called 'carry trade'... All the money being printed in Japan in the last 30 years has been creating inflation in a lot of the underdeveloped countries in the world, just not in Japan... The World economy is so interconnected nowadays that most policies of the past doesn't work anymore as Central Bankers would expect. Keynesian Ben Bernanke's helicopter isn't creating inflation nor growth...

'Long run' in economist-speak means multiple decades, generally.

But to answer your question directly, it's because the financial crisis and the massive deleveraging it caused effectively sucked a lot of money from the world economies. In the absence of QE we would've seen a painful, grinding deflation like Japan went through during the 90s.

Central banks can print money to increase the monetary base, but that's directly offset by 1) the large destruction of financial value during the crisis and 2) the fact that people are just taking that money and sitting on it. The net effect is less leverage in the system and not much effective change in liquidity.

Note that less leverage is a good thing in this case -- it makes banks less likely to go bankrupt, and makes a repeat of the '08 crisis much less likely.

http://www.investopedia.com/articles/investing/022615/why-di...