And they've bought bonds to try to drive down long-term rates.
The bond purchases are known as "quantitative easing," or QE. The Fed has completed two such programs. Some hope it will announce a third. Supporters note that the U.S. economy remains less than robust, and unemployment is a still-high 8.3 percent. Further reducing rates on mortgages and other loans could energize the U.S. economy, they argue.
Critics counter that more bond purchases by the Fed could ignite inflation. They note that the U.S. economy has been steadily improving, and unemployment has dropped for five straight months. Remarks that Bernanke made at the hearing Wednesday suggesting a brighter economic outlook made further bond-buying appear less likely.
The ECB is legally barred from buying bonds directly from governments. But it's bought 219 billion euros ($268 billion) in bonds on the secondary market to try to lower rates and reduce borrowing costs for Europe's most troubled economies.
The ECB has also been cutting short-term rates and offering super-cheap loans to banks. In its second installment of three-year loans, the ECB is charging just 1 percent interest. The idea is to get banks to use the loans to buy government debt and further ease nations' borrowing costs.
Earlier this month, the Bank of Japan announced an expansion of its own asset-purchase program. So did the Bank of England.
"Everyone is following the Federal Reserve's example of printing money to get out of this economic slump," Jones said.
The Fed's expanding balance sheet reflects its ability to create money, use it to buy Treasurys and lower long-term rates. Lower rates make borrowing cheaper. And they typically cause some investors to shift some money out of bonds and into assets such as stocks. Stock prices tend to rise as a result.
A larger number of dollars in circulation lowers the dollar's value compared with other currencies. That can help the economy by making U.S. exports cheaper overseas.
Central banks face a delicate task in deciding when and how to unload the assets on their swollen balance sheets without jolting the financial system.
Bernanke and other central bank officials have stressed their commitment to gradually tighten credit before inflation poses a major threat.
"Central banks around the world are making a bet that they will be able to handle inflation down the road," said Diane Swonk, chief economist at Mesirow Financial.
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