Monetary policy can do its job, but in the absence of a stabilisation capacity it will only do it more slowly and with more side effects. A combination of monetary and fiscal policies might have delivered similar results on growth and inflation, but faster and at a higher level of interest rates. It needs to be complemented. Yes it does. That’s crucial.
That’s the huge lesson, isn’t it? That’s your message in Sintra, but is it politically feasible? How do you get around the German objections? This is certainly valid. This objection has been there now for many years. Try 25 years.