Welcome to DU!
The truly grassroots left-of-center political community where regular people, not algorithms, drive the discussions and set the standards.
Join the community:
Create a free account
Support DU (and get rid of ads!):
Become a Star Member
Latest Breaking News
General Discussion
The DU Lounge
All Forums
Issue Forums
Culture Forums
Alliance Forums
Region Forums
Support Forums
Help & Search
Economy
In reply to the discussion: STOCK MARKET WATCH -- Monday, 30 June 2014 [View all]xchrom
(108,903 posts)10. Decoding Draghi: Banks Still Puzzle Over ECB Grand Plan
http://www.bloomberg.com/news/2014-06-29/decoding-draghi-banks-still-puzzle-over-ecb-grand-plan.html
Mario Draghis latest stimulus tool contains a hidden message: If you think interest rates will rise before 2018, take the money now.
The European Central Bank president has offered lenders a fresh round of cash for as long as four years to keep them afloat and make them support an economic recovery by encouraging lending. Hes also inviting bets on when the ECB will scale back its ultra-loose monetary policy -- the more a bank expects borrowing costs will rise over the term, the more attractive the loan looks.
Four weeks after the ECB unveiled an unprecedented plan for boosting the euro areas floundering revival, economists and investors are still grappling with its intricacy. While Draghi is trying to reassure investors that the ECB will keep policy loose for longer than the U.S. Federal Reserve and Bank of England, the link between the size of stimulus now and the prospect of higher rates later is a reminder that cheap money wont be around forever.
Draghis latest move has stepped up the complexity of monetary policy, though simpler options exist, said Andrew Bosomworth, managing director at Pacific Investment Management Co. in Munich. Id reserve judgment until we see results from the economy, but if I were trying to make a guess, it would be a 50-50 call whether its going to work or not.
Mario Draghis latest stimulus tool contains a hidden message: If you think interest rates will rise before 2018, take the money now.
The European Central Bank president has offered lenders a fresh round of cash for as long as four years to keep them afloat and make them support an economic recovery by encouraging lending. Hes also inviting bets on when the ECB will scale back its ultra-loose monetary policy -- the more a bank expects borrowing costs will rise over the term, the more attractive the loan looks.
Four weeks after the ECB unveiled an unprecedented plan for boosting the euro areas floundering revival, economists and investors are still grappling with its intricacy. While Draghi is trying to reassure investors that the ECB will keep policy loose for longer than the U.S. Federal Reserve and Bank of England, the link between the size of stimulus now and the prospect of higher rates later is a reminder that cheap money wont be around forever.
Draghis latest move has stepped up the complexity of monetary policy, though simpler options exist, said Andrew Bosomworth, managing director at Pacific Investment Management Co. in Munich. Id reserve judgment until we see results from the economy, but if I were trying to make a guess, it would be a 50-50 call whether its going to work or not.
Edit history
Please sign in to view edit histories.
36 replies
= new reply since forum marked as read
Highlight:
NoneDon't highlight anything
5 newestHighlight 5 most recent replies
RecommendedHighlight replies with 5 or more recommendations
Oligarch agenda to destabilize, polarize and militarize every continent on earth...
Ghost Dog
Jun 2014
#22