Bank of England Governor Mark Carney says easier monetary policymay be needed to help a slowing economy in the wake of the U.K.'s vote to leave theEuropean Union. This response is straight from the handbook ofmodern central banking—a favorite with the Federal Reserve, theBank of Japan, and just about every other central bank. But itmight be the wrong reaction.

I argued last month that ever-lower interest rates might bedestroying whatever faith businesses and consumers have left in theeconomic outlook. Cheap money keeps zombie companies alive,trapping capital in unproductive endeavors that would otherwisedie. And negative interest rates are unprecedented, and look a lot likeallowing doctors to experiment on their patients. The feedback Igot suggested another compelling reason that higher rates might bea better approach: demographics.

If you look at the age balance of the global population betweenold and young people, the over-65s account for almost 9 percent ofthe total, a figure that's been rising steadily and has doubledsince the start of the last decade. For the euro region, thiscohort accounts for closer to 18 percent; in the U.S., more than 15percent of the population is past standard retirement age, up from12.5 percent a decade ago.