Is it true that the ECB is going to use QE and at the same time keep raising the rates?

>Print money to buy government bonds
>Raise the interest rate on loans extended to commercial banks.

Brainlet here. What are the implications of this?

SPOTTED

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>b-b-but it’s because Russia is bullying us

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This will not make a dent on inflation lmao.

It’s only done to maintain the PIGS on life support (which has 0 hope with ageing populations)

The increases in goods and services are due to a global scarcity of materials and components not money supply.

Basically it means inflation will continue but interest rates will rise.

This is good because it will slowly deleverage the economy.... as inflation slowly erodes the value of the dollar... the value of debts will also decline. Banks won't refinance loans as much because debt will become more expensive as well.

This is how we can raise interest rates without causing a global debt default crisis.

Inflation is basically debt-relief. If we devalue the dollar by 50%, we devalue all debts by 50%, it's like the government just paid off 50% of all debts. They're doing that very slowly and then making it harder to take on new debt.

>The increases in goods and services are due to a global scarcity of materials and components not money supply.

It's due to both. This will help with the demand side of the equation.

That only works for fixed rates debts. Also, with higher rates it will be more difficult to get debt, ao it will be more difficult to do business and whatnot (I’m not talking of nigger-tier debt).

>Also, with higher rates it will be more difficult to get debt, ao it will be more difficult to do business and whatnot

Yeah that's good, the economy is way too overleveraged right now.

In the 50s, private debts were like 30% of the economy, now they're like 140%.... we need to reduce debt ratios and raising interest rates SLOWLY is a great way to do it.

>they should stop using the ECB for political purposes
Yeah good fucking luck with that. A central bank is only ever not gonna be used politically when it stops existing.
>institutional personification of schizophrenia
That's a nice way to put it. It's essentially what happens when you have new faces with new objectives every couple years, no long term plans.
>They are pursuing good policies
They're pursuing one of the few ways they have to mitigate damage they themselves have created, you mean.
>Inflation is basically debt-relief.
Yeah, paid by people's savings and income. Oh, but I'm sure salaries will raise to meet inflation rates! When haven't they in the past after all? This is not going to burden the average man at all, I'm sure.

The EU is raising interest rates to lower inflation, but at the same time printing a shitload of money to keep governments solvent in light of the energy crisis. It sounds stupid because it is.
They are doing this because the crisis doesn't hit everyone the same way, so they want to spread the pain to lessen the strain on the more vulnerable countries.
They should just admit they aren't in the position to strongarm Putin (over fucking Ukraine, no less) and get him to give us gas again. But hey, they can't naysay their CIA handlers, can they?

you are retarded if you think this will work simple like this, people will move out of euro and inflation will increase if real rates continue to be negative.

>How to tell you have a PhD in economics and work for Fed/ECB without telling you have a PhD in economics and work for Fed/ECB

>Yeah, paid by people's savings and income.

Savings is just another way of saying you own debt. Your savings is someone elses loans. You can't forgive debt without cancelling the bond.

>Oh, but I'm sure salaries will raise to meet inflation rates! When haven't they in the past after all?

Yeah sure, because McDonalds employees earned $18 an hour and got a $100 signing bonus in the 1950s... I'm sure.

>his is not going to burden the average man at all, I'm sure.

Yeah... fixing the global economy... totally a bad thing.. totally.

>people will move out of euro and inflation will increase if real rates continue to be negative.

You have literal down syndrome.

Costs are increasing because of the scarcity of raw materials and WIP not because of money printing (which mostly went to subside welfare, stock market bonanza and the housing markets and PIGS.

The costs are increasing because a collection of bad political decisions have led to supply crunches across the world.

Europe and The US (which are net importers) are suffering particularly because of their LCC outsourcing approach.

Playing around with yield only impacts internal markets (like housing) not globalised commodities.

The objective here is not to reduce inflation but to make PIGS (particularly Italy) survive

But i thought Russia is irrelevant to world economy? Whats going on guys?

Germany, once a manufacturing hub is going to get crippled by this. Europe will grow poorer while Russia and China create a new system for the global south.

>Costs are increasing because of the scarcity of raw materials and WIP not because of money printing (which mostly went to subside welfare, stock market bonanza and the housing markets and PIGS.

Both of those play a factor, not everything has to be thought of in a binary fashion.

>The costs are increasing because a collection of bad political decisions have led to supply crunches across the world.

No, it's not bad policy, it was the best policy on the books.

So wait, they're printing money and buying up stuff, including dept, for which they're raising interest rates?

No they won't, this will make Europe a lot richer.

They are going to try. It's going to end badly.

starving trillionaire 2023

Please tell me how, jew.

Now that I'm realizing it, isn't this a downie version of MMT? Why I am not surprised that these things are implemented by the EU?

Wow, this retard is out of his mind haha, ECB just said today that Italy, Greece and others are in default without intervention and you are still in denial, i bet you are a jew sitting on a pile of gold right now talking shit here.

You’re so dumb it’s actually remarkable how you blatantly lie like this and think people won’t call you out. Europeans will pay an arm and a leg for gas, electric and the most important FOOD. Where do you think that cheap fertilizer comes from? You’re all done. WE are fucked as well but nowhere near the level fucked the euros are.

>uneducated
kek I remember when they were throwing this one out at anyone critical of invasion immigration

Do you know what’s funny? That like during COVID where whoever expressed (even valid) concerns about the handling of the crisis, the vaccines, or the mask mandates, was labeled as a conspiracy theorist, people who are against the involvement of Italy in the war, eg. sending weapons to Ukraine, are called Russian propagandists.

>Both of those play a factor, not everything has to be thought of in a binary fashion.

The high (>2%) Inflation did not start because of the loose monetary policy or low interest rates. It started because of a scarcity of materials and producer costs jumping everywhere in Europe and US.

Which political decision are you referring to that was good and caused inflation?

I explained earlier in the thread.

QE combined with higher interest rates is called INFLATIONARY DELEVERAGING

Yes... they are in default without intervention, which is why the ECB is intervening.

"downie version of MMT"

YEah, im sure the most educated economists in the world are downies, meanwhile a WOP from pol has the answers.

>Europeans will pay an arm and a leg for gas, electric and the most important FOOD.

Oh my god you're so fucking dumb.

The effects of the supply shocks are already priced in dumbass. They are now remedying it.

>Which political decision are you referring to that was good and caused inflation?

I think the deficits ran under Trump and Biden were good. It was the right approach to deal with the Covid-19 pandemic. Especially since the deficits were financed with monetary expansion.

I can acknowledge that they were necessary policies and still acknowledge they had a role in engendering inflation.

I can acknowledge Lincoln's greenbacks caused inflation but still praise him for his war financing efforts.