ECB extends bond-buying programme
The ECB announced on Thursday that it would prolong its controversial bond-buying programme until March 2017. Because investors had expected an increase in the volume of monthly purchases, stock markets around the world slumped on Thursday. But the investors' disappointment is unjustified, commentators write, and doubt that Europe's economy can be saved with additional money.
Not a lack of money that ails Europe's economy
The stock markets' reaction is inappropriate, writes the centre-left daily La Repubblica: "The lack of political decisions is inflating the bubble of expectations vis-a-vis the ECB, which people want to see painting a rosy picture of the continent's economy. … We are looking here at a bubble which unfortunately is also being fed by the ECB bosses with their constant promises to do everything possible and impossible to get the ailing economy back on track. Could Mario Draghi have done more? Perhaps. But supposing he had extended the bond-buying programme by twelve instead of just six months and raised negative interest rates to 0.4 percent instead of 0.3 percent, would that have changed the outlook for the euro and the Eurozone? Those who believe in such measures are not only fuelling false hopes but also refusing to recognise that the problems of the Eurozone are not down to a lack of liquidity."
Draghi did his job
Draghi did a good job, the centre-left business daily Cinco Días writes in praise, and defends the ECB chief from disappointed reactions on the part of investors: "Although the investors don't like the restraint of the ECB's monetary policy, surveys reveal that the credit flow in Europe has improved tangibly in the last two years. The clouds Draghi is hoping to dispel from the Old Continent's skies are potential deflation and contagion from the turbulences in the emerging economies. … As Draghi has repeated on many occasions, Europe cannot rely on the magic wand of the monetary authority for recovery but must reform its economic profile and prepare it for the future."
Money printer must be stopped
Draghi's course is highly risky, the centre-left daily De Volkskrant comments in dismay: "He sees the risks the glut of money entails for the future, like hyperinflation and huge financial bubbles, as less threatening than the acute danger of economic stagnation. … But Draghi and the ECB can't influence the basis of the real economy. By printing money all they can do is ensure that the banks have enough cash on hand when entrepreneurs or house-buyers come to them for a loan. There was a shortage of money during the credit crisis, but now it barely plays a role. While the ECB is speeding up the money printing machine the US Fed is heading in the opposite direction. … This will widen the chasm between the Europe and the US and continue to put pressure on the euro exchange rate."