It is also worth pointing out that the strong increase in liquidity in 2001 was not specific to the euro area but was a global phenomenon which pointed to the existence of common (financial market) factors influencing monetary developments as well as reflecting the stance of monetary policy in the major economies in 2001.
The consequent heavier discounts applied to those long-term expectations have induced a major scaling back of new capital spending initiatives, though one that presumably is not long-lasting given the continuing inducements to embody improving technologies in new capital equipment. In addition, a deterioration in sales, profitability, and cash flow has exacerbated the weakness in capital spending. Pressures on profit margins have been unrelenting.