For months, the inflation rate in the Euro area is above the target value of the European Central Bank, and for years, the Eurozone is growing strongly. And what is the ECB doing? Your Central Bank decided on Thursday to let the program to buy government bonds and other securities, as planned, at the end of the year expiry.
Who’s telling now, the ECB is stepping on the monetary policy brake, goes to the President, Mario Draghi, on the glue. Because in truth and in fact, the Central Bank remains a Gas. Only net purchases of government bonds will be as of next year. With the money from maturing bonds will continue to be bought fresh papers. From a Stop the bond-buying programme can therefore be no question.
The balance sheet of the ECB remains as bloated as ever
as a result, the balance sheet of the ECB remains as bloated as ever. Unlike the American Central Bank, the Fed, since it was now ten years past the financial and economic crisis as a great role model, does not reduce the ECB’s bond portfolio. You don’t also increases the interest rates, but remains at the zero interest rate, and keeps track of negative interest rates for banks. The consequences for savers and pensions, or for house prices and Rents are Draghi obviously don’t care, even German Chancellor Angela Merkel seem not very umzutreiben.
Who tries to capture the extent of government and corporate financing in the Euro-zone by the money politicians have at least half must the ECB’s balance sheet in relation to the performance of all the economies of the Eurozone. Unimaginable, but true: More than 40 percent of the economic output in the Euro area runs through the balance sheet of the ECB.
The questionable financing of Euro area countries by Draghi has still the blessing of the European court of justice. Let’s see how the Federal constitutional court will react.
Because the ECB’s burned all the money, political resources, which it has, so in spite of the economic recovery, a maximum of expansionary moves, the question arises as to what it intends to do in the downturn, which will come as sure as the poor in the Church at some point. She then buys stocks or all bonds?
Draghi wants to set today for half of the term of office of his successor, the course of monetary policy. For four years more the state will be used to purchase bonds. The lost trust is of the can’t win enviable successor to Draghi’s hardly back.
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