Twenty-six economists forecast the central bank would start purchasing government bonds this year, while five thought it would not.But economists sceptical ECB bond-buying would revive eurozone.
What people think about this?
The current situation reminds me of the patient in Intensive Care, hooked up to a ventilator and other life support systems; gradually going from one organ failure into another. We are using a powerful antibiotic (QE) to try and prevent a potentially resistant infection (deflation), but unless the the body's own immune system (production & demand) picks up, the whole organism will die. These patients are extremely 'brittle'. Seemingly innocuous therapeutic errors can be magnified and be rapidly destructive. You never know where the next crisis will originate. Recovery depends on 2 things: an innate will to survive on the part of the patient, and the skill, care or dedication of the clinical team. Dunno about the 'patient', but not much confidence in the economic 'doctors & nurses'.
There is considerable imbalance across the Eurozone economies. What happens if a national government can't repay the monetised debt? Will the ECB forgive it?And is ECB QE legal under Maastricht?