I'm talkin' 'bout money falling from the sky

 

"We will see a variant of helicopter money (perhaps thinly disguised) in the next 10 years if not the next five," says Colombia University economist Richard Clarida.

"All central banks can do it. The question is, if and when is it opportune," says the ECB's Peter Praet.

The WSJ looks at different types of monetary financing. It seems almost crazy that governments would try to create inflation by giving money away but if you look at the last 20 years of QE failure in Japan and recognize that the country actually had a lot going rightfor it during that time, there is a good argument that it's only a matter of time and circumstance before someone tries something more desperate.

From the WSJ:

"Helicopter money merges QE and fiscal policy while, in theory, getting around limitations on both. The government issues bonds to the central bank, which pays for them with newly created money. The government uses that money to invest, hire, send people checks or cut taxes, virtually guaranteeing that total spending will go up."

There are a few examples in history where it's worked without creating hyperinflation.

 

All we have to do is to sit under the helicopter