In the second stage, since August 2014 when the ECB announced various credit easing packages and in particular since the announcement of the ECB’s PSPP in January, ECB unconventional monetary policy has become the main driver of long-term interest rates in the euro area.
Ultimately, the extent of these adjustments depends on how we choose - either explicitly or implicitly - to distribute the economic burdens of the aging of our population across generations. Inherent in that choice are questions of intergenerational equity and economic efficiency, questions that are difficult to answer definitively but are nevertheless among the most critical that we face as a nation.