…staring in 2000, the BOJ nearly doubled monetary base over a period of 3 years. And the money just sat there. Banks did not, in fact, expand loans. In fact, Japan’s experience is a key element of the case against monetarism. Just printing notes does not work when you’re in a liquidity trap.
From Friedman On Japan – NYTimes.com
And it also doesn’t create the type of hyperinflation some worry about.