Very recent commentary is shown below, abstracted from the website above, about the options open to Draghi.

The ECB governor has gone for the second option; the negative in all senses = -0.4% rate of interest.


The pointless option open to Dragula is yet more QE. I’m told even he now accepts this isn’t going to have any effect, but he will continue with QE anyway, as sounding doubtful about it would cause a selling panic and drop the euro by six points. As the US and Japan found, heroin is great at first, but then you need it to feel normal. Once detox is necessary, there is only cold turkey and diarrorhea.
The negative would be to plunge the pendulum further down the conversion of Zirp into Nirp pit. This is the expectation now, so as with so many of these ‘policy’ statements, Dragnet must do this at least. I posted last weekend about why this is a terrible idea, and that more or less guaranteed it being adopted.
The foolhardy but entirely sensible approach would be to tell Schäuble, the Bundesbank, Drizzlebang’s f**kwitted eurogrope and all the other austeritistas to grow up and accept the need for a change in strategy. While I do think that very unlikely indeed (for political, not economic, reasons) I did learn yesterday that Draghi is likely to drop in a reference along the lines of “we must look to sovereign governments for new ideas about economic stimulation, the monetary toolbag being empty” – albeit not quite that bluntly…..although that would be accurate: the only monetary solution left open to Signora Dragqueen is to bring down all the Monets lining the ECB corridors, and flog them off

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Dave