“It is a mistake to suppose that Q.E. is a panacea in Europe, or that it will be sufficient,” said Lawrence H. Summers, who was Treasury secretary under President Bill Clinton.
Mr. Summers, who spoke on a panel about quantitative easing at the annual meeting of the World Economic Forum on Thursday morning, said that many of the elements that made stimulus measures in the United States a success, including the fact they were not widely expected and that interest rates were higher, do not exist in Europe today.
The benefits of a widely expected bond-buying program by the European Central Bank have effectively already been priced in, he said, with bond yields and stocks rising, and the euro falling against the dollar.
“Q.E. has already had a significant impact,” he said. “That’s why I am worried.”
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Peter Eavis contributed reporting.
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