by Detlev S. Schlichter
Whiskey and Gunpowder
Every monetary stimulus creates winners and losers. And it should be no surprise that monetary policy would finally end in a cul-de-sac. It only surprises those who share the mainstream’s simplistic view of monetary stimulus. Phrases such as “the ECB is attempting to unlock the flow of credit in the Eurozone”, mask the complexity of the true effects of money creation and interest rate manipulation. They make ongoing monetary stimulus look unduly harmless and straightforwardly positive. Who could object to unlocking credit, to liquefying markets or stimulating activity?