The US Federal Reserve's plan to buy long-term US government bonds is radical enough to shock the global market. But it's not a rational fix to the underlying problems for the US economy. Worse, it can foil international efforts to reduce global imbalance and restore growth in an orderly way. After loosening its conventional monetary policy to the extreme, the US central bank recently decided to bring into full play alternative measures by buying up $300 billion of long-term government bonds.

The complex terminology of quantitative easing may help sell the Fed's action as an urgent step to reduce the cost of lending and prevent deflation. But it cannot change the fact that such a tactic amounts to creating vast new sums of money out of thin air.

Direct debt purchase may stimulate the US economy for a while. Yet, by doing so, the Fed is monetizing US government debts largely at the expense of long-term holders of US dollar-based assets. This is so dangerous an approach that some people thought the Fed has laid in a course that can only lead the US dollar to ruins. And if that is the case, there is no hope that the international community can find a way out of the current global crisis any time soon.