Loading ...Thursday’s ECB meeting is expected to be one of the most important in recent years: Mario Draghi has signaled, and is widely expected to announce a blueprint of what the central bank’s QE tapering will look like beyond 2017, and while no actual tightening will be implemented – either via rates of asset purchases – the ECB is expected to announce it will cut its €60bn/month bond purchases in roughly half starting in January 2018 and lasting for the next 9-15 months.
SOME CHOICE COMMENTS BY ZH READERS:
new Ghordius Oct 26, 2017 6:50 AM
five years ago, I joined this club in the expectation of having a few good fights
the tenor, then, was that Draghi did not have a bazooka, not even a water pistol
later, Draghi started to shoot grenades from a revolving six-barrel supercannon that would have made any Rambo envious
now, the tenor is that he is running out of ammo
this new myth is based… on an internal agreement among the 19 national banks that are truly behind the ECB, which is still a monetary alliance more then anything else, led by 6 of them that engaged in 80% of this “shooting”
this internal ruling says, roughly: “don’t buy more then 33% of any national bond pool”. with… snark, snark, an add-on: “because otherwise we look like monetizing“
so… no. I completely reject that myth of “Draghi out of ammo”. the FED, as a reminder, is going to “watch paint dry”… or so it says
the ECB’s “merry 19”, in particular the “plucky 6” are going to slow down. but no, there is no pressure from any “running out of ammo” theory. the whole exercise was and still is a response to the FED (and all the others) engaging in QE… period
the whole reason for the ECB to even exist was, and still is, to do that… in an orderly fashion, in case it’s necessary
“stabeeleetee” and… no “Currency Wars” among/between the members. and… period, that’s it
Going to release a blueprint of a taper that will begin in ’18. Dear God, how long until someone cuts the legs out from under this bubble of an economy central banks have created over the last 10 years. We know, you know and all your friends know that their wealth depends on a continued printing. You’re going into the worst crack house in Chicago and getting everyone to agree on the exact date they will quit using the crack pipe. Damn