An increasingly desperate ECB head, Mario Draghi, this morning announced a smorgasbord of monetary policy measures intended to fight deflation. Of course, deflation is only a problem in the pocket universe inhabited by Keynesian economists and politicians – for the rest of us, who live in the main universe, it is a good thing. Really what he wants to do, as discussed earlier, is push down the euro against the competing currencies, principally the yuan, the yen and the dollar.
So far, no luck as the euro is marginally stronger post-announcement and press conference.
This is the worst kind of “make-it-up-as-we-go” policy – these policy measures have not been tried before and their effects are unknown (except in the pocket universe, where economics works by mathematical rules). It is irresponsible and will end badly. Very badly.