An employee counts renminbi (yuan) banknotes at a bank in Lianyungang city, East China's Jiangsu province, June 4, 2014.[Photo/IC]

Speculations on exactly when the US Federal Reserve will raise interest rates are high, because it could be a game changer moving global markets in significantly different directions. Speculation are also rife on why the Fed has dragged its feet on the matter.

But the fact that the world economy has still not emerged from the shadows of the 2008 global financial crisis should justify an immediate end to the unprecedented experiment of zero interests that the US led the world into.

The sooner that happens, the faster necessary reforms can be implemented in all countries and the better the chances will be for the world economy to improve. The resulting elimination of uncertainties in the global financial market, rather the world economy as a whole, will be more than welcome for China which is implementing far-reaching economic reforms to survive its difficult slowdown.

Recent signs that an increasing number of developing economies are under rising pressure of capital outflows have prompted calls for the Fed to postpone the inevitable for another couple of months.

But each day has passed with investors putting on hold big bets ahead of the Fed’s policy meeting with the world economy is a step behind on its long road to recovery.

Seven years after the collapse of Lehman Brothers, a Minsky moment that forced major developed countries to print huge amounts of money to save their economies, the global recovery remains disappointingly fragile.

On Wednesday and Thursday the Fed will hold a closely-watched meeting to decide whether or not to raise interest rates for the first time since 2006. The Fed has indicated it will raise rates when it sees a sustained economic recovery, with emphasis on jobs and inflation, in the US. But the complex economic scenes in the US, where the job market has improved somewhat while inflation has been pulled fairly down by weak oil prices, ostensibly give no guarantees, up or down. Not to mention the likely dire consequences a change in the US monetary policy will bring about, whose brunt will be borne by developing countries.

The compelling reason why the US should abandon its unhealthy addiction to cheap credit is that at best, its current monetary policy is not working its magic as promised and, at worst, it has created unpredictable instability and prolonged stagnation around the globe.

As an innovative measure to prevent the worst effects of the global financial crisis from materializing again, the US had decided to flood the market with unlimited supply of cheep money to stop panic sales and maintain investor confidence. That emergency move, together with coordinated stimulus packages issued by major world economies did effectively arrest the free fall of the world economy in following years.

But by keeping their interest rates too low for too long, the US and other major developed economies have bought themselves the needed time to continue business as usual as long as possible, instead of going in for painful but necessary economic restructuring.

Since their economic systems, growth policies and financial regulations have not been overhauled, policymakers and central bankers in these countries have expected the flood of cheap money to encourage consumers to shop, companies to borrow and investors to bet, which, in turn, will help their economies spend their way out of recession or economic slowdown.

Unfortunately, that has not come about. Instead, a rising tide of easy money is floating the boats of many asset classes. All tides recede sooner or later. And when this economic tide does , it could hurt many.

Since the policy of cheap money has proven less ineffective in boosting sustainable and inclusive economic growth than widening global wealth disparity even seven years after the financial crisis, it is time to stop it.

The author is a senior writer with China Daily. zhuqiwen@chinadaily.com.cn