Every time I hear about the lacklustre effects of the European Central Bank’s Quantitative Easing programme it reminds me that hope, like legal tender clearly springs eternal. I also think of a Roulette Wheel and how the financial elites keep spinning it no matter what happens. No matter how bad it messes things up. It goes like this.
A highly qualified ensemble of generously paid “experts” representing prestigious and respected institutions, governments and banks reigned over a financial meltdown. Next we were repeatedly told (by the above) that only the repayment of bondholders would satisfy the markets and return Europe to stability. Or in other words we’d have to accept the imposition of gambling debts and mismanagement which weren’t directly ours. On the upside we were also promised an overhaul of the systems and structures that allowed such perverse practices to exist. How brilliantly visionary and democratic! Except things got worse.
Much worse. Emigration. Job losses. Repossessions (not many bailouts here). Rising inequality. Ballooning poverty. Falling standards of living. Explained as regretful side effects of the necessary medicine. Contagion was worse than expected so we needed structural readjustments. The meek must thank God we didn’t burn the bondholders or God knows, we might be back eating potatoes three times a day. Apologies in advance to those among us who may in fact be eating less. Just remember, necessary medicine!
ECB Headquarters
Eu President Mario Draghi
Of course the European narrative doesn’t explain why Lehman Brothers ($600 billion in “assets”) was allowed to collapse. My theory is that many American citizens own guns. And it’d be pretty stupid to ask armed citizens to pay for the debts of white collar gamblers.
Sour and bitter as this all sounds, that’s what it boiled down to. We sucked it up and the bankers, the financial risk takers and gamblers lived to fight another day. Except it got better for them. Much better.
The ECB eventually began pumping trillions of euro into the markets to stimulate the lenders/banks to enable borrowers to take risk and start spending, a process known as quantitative easing (QE) also known as printing money also known as weakening your currency. QE has it’s detractors and numerous critics say it will bring disproportionate benefits to the richest in society. But what have been the results since implementation? Average growth in the real economy across Europe is stagnating and equities (stocks and shares also known as the risky things that go up and down suddenly and don’t really reflect the economy we actually live in) are booming. Another speculators bubble is mounting on the back of QE. Meanwhile the financiers and the gamblers are creaming it off again. If you made it up, no one would believe you. Seriously. Could it be any more ridiculous?
There were other options to get things moving but well, the experts knocked these as unmanageable, uncontrollable and too populist. Especially the options which would have resulted in getting money into national infrastructure projects, training projects or even directly into taxpayers hands. Those crazy ideas would of course result in less slush funds getting into the system to be creamed off.
And finally as regards accountability and reform in the system…? It’s been fairly negligible as far as I can ascertain. It’s as if the Commission fail to understand the mounting concerns of it’s citizens. Then again, to paraphrase a famous quote, it may be difficult to get them to understand us, when their large salaries depend upon not understanding!
DermyMcNally 