US economist Milton Friedman stated that it would be theoretically possible for governments to drop large amounts of cash from helicopters for the public to pick up and spend. Perhaps, his theory is being embraced by the central banks during these testing times. The US-originated financial crisis is impelling them to search for new means of protecting their banking systems and economies.

Having exhausted all the traditional methods of spurring economic growth through interest rate cuts, the Bank of England (BoE), the US Federal Reserve, Swiss National Bank (SNB) and Bank of Japan (BoJ) have announced new and unconventional means of injecting capital into their economies through a process known as `Quantitative Easing'. Wikipedia defines Quantitative easing as a monetary policy adopted by central banks to increase the money supply by a pre-determined quantity via open market operations. The aim is to simply boost the supply of money by creating new money, which can, in turn, generate demand in the economy. The dynamics of quantitative easing are quite interesting, yet complicated. This process was first mooted by BoJ in 2001 to protect their ailing banking system. Success in Japan has prompted BoE to adopt the process, followed later by Fed and SNB. BoJ has decided to use the process again with the intention of repeating the 2001 history. The Indian central bank is also forced to carry on with the process in a phased manner. Experts opine that many more central banks may take this route to help revive their economies.

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