This week the Monetary Policy Committee (MPC) will decide whether or not to extend its programme of quantitative easing (QE), ie buying assets with central bank money.

It's one of the oldest tricks in the book - rulers have always sought to reduce the coinage’s precious metal value.

Only when umpteen million of Europe’s unemployed and dispossessed find jobs and hope will the issue be over.

With unemployment obstinately high and fiscal policy on ice, the Federal Reserve will continue to push down long-term interest rates. Further rounds of quantitative easing will tend to weaken the dollar. This is a much more effective way to move our currency than any foreign-exchange market intervention.

Clearly, the Fed chairman recognizes the severity of the problem and has decided to do whatever it takes to prevent anything like the Great Depression from happening again. Given where we are today, that means printing money, even if that runs the risk of creating a serious inflation problem.

In our view, the Fed’s current “print the money” strategy (and, yes, I know the Fed doesn’t like this term or even “quantitative easing”) is make-or-break for turning the economic corner any time soon. It’s incredibly risky in terms of potential inflation – more than the Fed would ever concede – but preferable to all the available alternatives.