From Wolf Richter at wolfstreet.com:
The ECB started its €60-billion-a-month QE bonanza earlier this year and was expected to run it through September 2016, but already the Big Money is clamoring for more. Shook up by what’s happening in China, the ECB said it might accommodate them.
Now Standard and Poor’s warned or recommended – whichever – that the ECB could double the size of the QE program, to €2.4 trillion and extend it “until mid-2018.” That the Big Money is clamoring for more is no surprise: despite the ECB’s QE and negative deposit rates, stock prices have plunged, with the German DAX down 23% in six months.
So here comes Peter Praet, ECB Executive Board Member and Chief Economist, with an amazing presentation at the BVI Asset Management conference in Germany, showing one devastating chart after another on how the euro has failed the Eurozone economy.
Optimism, when published by economists, is usually designed to hype what needs to be hyped at the moment. This is universal. But in the Eurozone, even economists are dialing back their optimism. In the chart below, Praet shows how expectations of economic growth for five years ahead have dropped over the 15 years that the euro has been around:
To continue reading: The Euro Doesn’t Work