Big moves by the Fed and the Bank of Japan have many analysts and experts suggesting we could be on a road to disaster.

On Oct. 29, the Federal Reserve's FOMC officially announced the end of its quantitative-easing program. Now that the Fed has increased its balance sheet from $892 billion to almost $4.5 trillion, its next move will involve "normalizing" the federal funds rate from its current "near zero" level (0% -0.25%).

This could be easier said than done and has triggered an intense debate over the possible outcome of these efforts.

Former Fed Chair Alan Greenspan recently remarked that normalization cannot be accomplished without causing financial turmoil. The Fed was able to taper its way out of bond buying without roiling the markets, but now, a former Fed chair is telling us that raising interest rates without agitating the financial markets will be more difficult — if not impossible.

This week, the always eloquent FOMC member and Dallas Fed President Richard Fisher re-asserted his belief that it will eventually become obvious that the costs of the third quantitative easing phase, the $1.7 trillion QE3, did not justify the benefits. Fisher explained that money spent by the Fed during QE3 has been used primarily to finance stock buybacks, increase dividends, fatten cash reserves, and recently, finance mergers by the most creditworthy companies. He urged the Fed to not return to bond buying if the economy falters again, saying, "Should the FOMC then try to compensate for fiscal authorities' inability to act by provisioning still more monetary fuel, it may risk an explosion of speculative excess, or worse: an eventual inflationary conflagration, the debasement of money and the ruination of our economy and lifestyle."

Within two days after America's quantitative-easing program ended, Bank of Japan Governor Haruhiko Kuroda led the BOJ to approve a huge expansion of Japan's quantitative-easing program. The changes include extending the average length of its bond purchases from seven years to 10. The BOJ will increase its balance sheet by 15% of GDP every year. Japan's debt-to-GDP ratio is currently 240%.

Although many commentators used to jest that America's Federal Reserve was planning a program of "quantitative easing to infinity," the Bank of Japan apparently has just that in mind. While many expect that it will be difficult for America's Federal Reserve to normalize interest rates and reduce the Fed's balance sheet, Japan could have an even more difficult time as its economy is not as large as ours and this program is significantly larger than the Fed's in relation to the two economies.

Mr. Fisher summed up his views by saying, "Only time will tell if stocks have risen to unsustainable heights and, if so, how deep a correction might be needed to bring them back to sustainable valuations." More outspoken observers say that central banks have set the stage for a global financial disaster.

Whatever our opinion might be, we must adjust to the market we have, not the market we want.

Long-term investors need to consider old standbys like risk tolerance, asset allocation and time horizon, while traders can look for opportunities on both the long and short side of the market. The Fed and Bank of Japan have a major challenge ahead, and the flip side of quantitative easing is sure to offer both danger and opportunity for investors and traders around the world.