The storm brewing in Europe with the European Central Bank (ECB) is its plan to buy bad debt from banks in the version of stimulating the economy. Of course this is indirect and will never save Europe – but it may tear it apart. The ECB and all who support them, have argued in their comments, that this program known as OMT, is simply monetary policy and is covered by the mandate of the ECB. Although the opposite is evident and is stated in the very purpose of adopting this to stimulate the economy, no government will ever see a limitation to their power for whatever it is from the NSA to ECB, they can always justify their actions.
The ECB claims buying bad debt is monetary policy, even if it still operates as obvious economic policy. The high Court must will now have to decide if the ECB is exceeding its authority. Quite frankly, buying in bad debt will do nothing for there is no guarantee that the banks will then lend this out to small business to create jobs. In the USA, small business could not borrow even with collateral. This is a stupid idea that will only fail in the end anyhow.
The ONLY way to stimulate the European economy is
- (1) return sovereignty to member states,
- (2) reduce regulation (including cow farting), and
- (3) reduce taxes abandon VAT and replace it with a simple sales tax.
Herein lies the problem. Once in power, they see all solutions with expanding power – never reducing it.