Leading British Austrian-school economist Anthony Evans writes on QE:
Economists tend to define QE as when the central bank conducts open-market operations to buy government and corporate securities using newly created money. Many economics textbooks fail to mention QE, suggesting that this is a new and extreme form of monetary policy. Indeed one of the reasons the Bank is keen to refer to QE rather than its colloquial name – printing money – is to distance itself from negative connotations. But two key points seem to be missing from the public debate. 1) QE is printing money; and 2) the printing press is already turned on.
The amount of currency in circulation was growing at 12% in January 2009, has consistently been expanding at a faster rate than GDP, and the Bank of England is responsible for this monetary expansion. What’s more, the consensus view of economic commentators is that a root cause of the financial crisis was artificially low interest rates and the resulting mis-allocations of capital. In short, the Bank’s solution is a larger dose of what caused the original disease.