LTRO: Quantitative easing in disguise?

Silvia Merler, Jean Pisani-Ferry, 2 April 2012Many analysts and observers have put forward that the euro crisis is a balance-of-payments crisis at least as much as a fiscal crisis. This column provides evidence of capital-flow reversals in Greece, Ireland, Portugal, Spain, and Italy.

ECB will release data on the early LTRO loans repayment tomorrow. The release will help gauge the liquidity needs of the European banking sector and the prospects for a further reduction in Eurozone excess liquidity from here given that the repayment of LTRO loans will likely continue over a period of time. Consensus expectations seem to be centered around EUR100bn.

Willem Buiter, 8 May 2010First published on 24 March 2009, this column is more relevant than ever. In it Willem Buiter argues that the ECB’s lack of fiscal backing is both unusual among major central banks and a severe handicap – it is a factor in why the ECB is “fiddling while the Eurozone burns” by hesitating to undertake quantitative easing started by the Fed, Bank of England, and others. Full Article: The European fiscal vacuum makes the ECB timid on quantitative and credit easing

  Paul Krugman has been taken shots at Martin Feldstein over this article (Link). Feldstein made the case that the Fed is keeping interest rates artificially low - and sooner or later this will cause a problem. The issue is whether the Fed is creating a new bubble. Feldstein says, "Yes". Krugman says "N0". A few lines from PK on this topic:  

Jean Pisani-Ferry, André Sapir, Guntram Wolff, 9 November 2011Europe’s surveillance of its highly-indebted countries has come under strong criticism. But these countries were also under the watch of another institution, the IMF. This column presents a report showing that the Fund is hardly without fault itself.Full Article: IMF surveillance of the Eurozone: Quo Vadis?

Calafia Beach Pundit submits: The Federal Reserve's quantitative easing program began over two years ago, and it has since triggered waves of concern and countless forecasts (including mine) of rising inflation.

John Dalt submits:Reader T.M. sent in a response to our recent letter yesterday. She saw an angle to the unlimited backstop to Fannie Mae (FNM) and Freddie Mac (FRE) I had not thought of. A little background first. The U.S.