Why do so many ignore what stops liquidity in Europe from reaching where it is most needed?

Sir, I refer to Wolfgang Münchau “If Europe insists on sticking to rules recovery will be a distant dream” October 6.

In it he suggest that for monetary policy to work better for Europe a “portfolio balance channel: when the ECB buys five-year sovereign bonds, the sellers will try to replace those bonds with securities of similar characteristics – say five-year corporate debt. If that happens, the price of the bonds would rise, the interest rates on them would fall, and companies will find it easier to raise money.”

And I have to ask, for companies able to raise funds through bonds in Europe, are the interest rates not low enough? What about all those medium and small businesses entrepreneurs and start-ups who, because of the limited amounts they need, have no access to the bond-markets? Why should they have no fair access to bank credit only because regulators with their credit risk-weighted capital requirements for banks want to favor “the infallible”?

Why would Münchau ignore the distortions produced by bank regulations and which stops liquidity in Europe from reaching where it is most needed? Are the small risky borrows not important enough for him to care?