Trichet's positive transformation

According to the business newspaper De Tijd, ECB president Jean-Claude Trichet has effected a "complete metamorphosis" in less than a year: "Of course it would have been better if Trichet had got a move on earlier than he did. Nevertheless we can only welcome these 'unconventional measures', as the ECB calls them. Prolonging the maturities on loans to banks gives them greater security in their financing. In the United States and the UK there are already signs that such moves are prompting banks to lend more readily and at lower interest rates. And the purchase of covered bonds will ease the credit flow to businesses and families. ... Sixty billion euros does not seem too much to pay for such a measure. But Trichet sees the danger of accelerated inflation on the long term. In addition, it seems only smart to wait and see how the economy develops before putting even more money into circulation."

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