Last week, the markets were all abuzz with talk of Quantitative Easing, or QE.  QE is a way to increase the money supply when the cost of money is at or close to zero.  In late 2008, the Federal Reserve flooded the marketplace with a couple of trillion dollars on a monthly basis through March 2010. 

This is a process I'd love to be able to do with my own accounts. The Feds credit its own account with money created "ex nihilo," meaning "out of nothing." Then it purchases financial assets like government and corporate bonds from banks and other financial institutions.  The purpose is to increase the money supply, thereby stimulating the economy.  The Feds decided to pump 600 billion dollars into the economy beginning this week and ending some months from now.  

This action begs the question: If trillions of dollars were "floated" in 2008 to early 2010 and banks sat on it and unemployment was up and growth was slow, then whose big idea was it that generating more money would cause a different reaction of any kind?  Japan is following our lead and using a similar policy, but Great Britain has said, "No thanks; we are fine with cutting spending and benefits."