DAVOS, Switzerland — As investors on Thursday awaited a decision by the European Central Bank on whether to begin buying up loads of eurozone government bonds — so-called quantitative easing — policy makers and bankers in Davos warned that the move would not be enough to jump-start Europe’s anemic growth.
“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 that 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.”
E.C.B. Stimulus Calls for 60 Billion Euros in Monthly Bond-Buying
The program, worth about $69.7 billion a month, is more than analysts had been expecting as the European Central Bank tries to fend off stagnation.
Other members of the panel agreed on Thursday that the ability of central bankers to determine economic outcomes was reduced by very low interest rates, opening a debate about other potential policy levers, including fiscal policy, to stimulate growth in Europe.
“We are in a new era, when central banks have largely lost their power to ease,” said Ray Dalio, chairman and chief investment officer of Bridgewater Associates. Embracing a well-worn theme at Davos, he emphasized the need for European countries to make deep structural changes to their economies.
“There is a lot of potential to make Europe more efficient,” he said.
Mr. Summers said that austerity policies in Europe had been counterproductive, and that he believed there was sufficient room for expansionary fiscal policy, or expanded borrowing by governments.
“I do not accept the judgment that there is limited capacity for Europe to engage in increased borrowing,” he said.
Christine Lagarde, managing director of the International Monetary Fund, countered that view. “Not many have the fiscal space to do it,” she said.
With Mr. Summers and Mr. Dalio focused on the challenges facing Europe, Ana Patricia Botín, chairwoman of Banco Santander, offered a brighter outlook. Santander, which recently raised roughly $9 billion in the markets, and other banks in Europe are ready to start lending, she said.
“I’m a lot less negative on Europe than a lot of Americans,” she said. “We are doing what it takes to get to a real currency union.”
The panelists also discussed recent movements in currency markets, including the fall of the euro against the dollar that is expected to help the European economy by bolstering exports.
Mr. Dalio said that the depreciation of the euro could contribute to recovery in the currency bloc.
“Currency depreciation will have to be part of it,” he said, noting that it is not considered “polite” to have such a conversation. Governments do not typically make public statements aimed at influencing the value of their currencies on world markets.
The risk of relying on currency depreciation is that too many countries could try it at once, eliminating the potential benefits and setting off a kind of currency arms race.
“We are in currency wars,” said Gary D. Cohn, president and chief operating officer at Goldman Sachs.
The panelists had differing views on when the United States would next raise interest rates. Ms. Lagarde said that she expected the Federal Reserve to make the move in the middle of 2015.
Mr. Cohen, for his part, argued that factors outside the United States would make it challenging for the Federal Reserve to act this year.
“The U.S. is growing, and that’s a nondebatable fact,” he said. “What I am concerned about is the ability of the U.S. to raise rates given what’s going on in the rest of the world.
Mr. Summers, not one to mince words, argued that the Fed should hold its fire. We “should not be fighting inflation until we are seeing the whites of its eyes,” he said.
Peter Eavis contributed reporting.