ECB readies package of rate cuts and targeted measures

ECB readies package of rate cuts and targeted measures: "The tools being prepared are consistent with measures Draghi identified in an April 24 speech in which he explained how the ECB would respond to three broad scenarios."



1.To respond to a de facto tightening of monetary policy caused by market moves like further euro gains, Draghi indicated the ECB could cut rates.



OR - "Thisa Maario here, thisa no problemo...leetle cut here and a leetle cut there." 

Unless it doesn't work as it isn't....except for Germany who masterfully convinced everyone they were opposed to rate cuts and would leave the EU if they began to weaken the Euro. Germany is crushing it, their companys', MB, BMW etc, crushing it. Because they have created an environment where all the other countries like Italy who could never afford their stuff if it was Lira vs DM, can now play pretend until the SHTF.

Rate cuts NO WORKEE.... Ponzi Level 2 below



2.To deal with problems transmitting its policy to all parts of the euro zone, he said the bank could deploy an LTRO targeted at encouraging bank lending or an ABS purchase program.



OR - " Hey, I'm Maario, you wanna somma this. Thisa no QE...yuh" - LTRO - Long Term Refinancing Operation - Ponzi Sauce Level 2 - ECB loans money in exchange for Sovereign Debt at ZIRP ( zero interest rate program) or close and in turn. If debt implodes, TS!, if economy implodes or doesn't recover as expected like here, TS!.



Ponzi Level 3 below...coming up !!



3.Under a third scenario of a deterioration in the medium-term inflation outlook, Draghi said on April 24 the ECB could respond with a "broad-based asset purchase program" - potentially QE.



OR - " Houston, thissa Maario, pleezuh connect me to my boyza atta GS...I havva problemo.."

"Whatchu meen they no givva sheet !!." "Okay then!! I flusha all this ECB sheet right onna yoo!!"



So, now Summer of '10 may be coming to a pretty European village near you. It won't work, the Europeans unlike the lemmings here won't stand for it for too long because they have not been raised to expect the entitled lifestyles people here had and assumed that was a baseline. And frankly, there is a large enough constituency that thinks the EU system sucks.

Play the game right and end up with the Tuscan Villa for about $10K !!!

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