This week’s interest-rate cut is a milestone for the European Central Bank. For the first time in two decades policymakers get to start a monetary-easing cycle without having their hand forced by a financial emergency. Instead, investors are signaling confidence about the euro area and keeping yields in check. But despite the calm on the surface, the economy is starting to see the consequences of problems that have been decades in the making. Increasingly eclipsed by the dynamism of the US and the rise of China, the euro zone is languishing with anemic growth, weak productivity, poor demographics, and bloated public finances in key countries. Benign markets and a recovering economy offer Brussels and national capitals rare breathing space to try to address those challenges. If politicians — navigating European elections this week — don’t take advantage to deliver growth-enhancing reforms and public-finance repair soon, the region risks sliding ever further into irrelevance. “Without a major jolt, the European Union will become a much-diminished global power, leaving the US battling it out with China for economic supremacy,” said Jamie Rush, chief European economist for Bloomberg Economics. https://www.bloomberg.com/news/arti...omy-facing-many-problems?srnd=homepage-europe Another leg higher for European + US stock prices?
This entrie world is obsessed with rate cuts.......there is zeroooooooo need or reason for rate cuts here or anywhere else in the world. The amount of times during a single week I see articles and hear news about rate cut talks is absolutely ridiculous. Why would we even need a rate cut when historically rates are still low....we have a stock market going absolutely gangbusters, gdp growth continuing to move higher and higher. ..brand new cars being leased at record highs, Unemployment rate at historic lows, earnings beating every single quarter, restaurants packed where your average bowl of pasta is $23.95, a housing market where we have nothing but all cash buyers and people still spending money like they have their very own money making printing press in the attic of the house they live in that just keeps skyrocketing in value.....so why any reason for a cut, well for one good reason. To keep everything juiced up. Can't risk losing the biggest asset bubble in history from popping....
Since the great bankster scam and crash of 2008 we have seen negative rates, for no good reason. Good companies are awash with cash, and the stock markets have enjoyed buybacks. Regular savers have subsidised the stock markets and the banks have made massive profits, except those 63 banks stuck with MBS's
What was the point of negative rate bonds in Germany, France, etc? It was obvious to anyone with a few braincells that the only buyers were the ECB or speculators hoping it would go even more negative. It was simply a transfer of wealth from the middle & upper middle class to the upper class. That's all you need to know about the ECB & EU in general. I'm still curious who elected these idiots running the EU? Are there elections in Brussels or something that I missed? Looks to me like another unelected monarchy.