Allan Meltzer for Economic Policies for the 21st Century: With $2.5 trillion sitting idle on bank balance sheets and more than $2 trillion additional sitting on corporate balance sheets, we should expect the Federal Reserve to ask: What can more quantitative easing — QE — do that banks and corporations cannot do without it? The right answer is NOTHING.

Continuing QE is a big mistake. Not only is it likely to roil world financial markets when it eventually unwinds, but it finances the massive federal budget deficit at low interest rates. Holders of bonds cannot all be nimble as rates rise. The sooner QE ends, the better off we will be, but ending QE quickly or slowly will not avoid international market disturbances.