What is more, a critical re-examination of history suggests that financial crises – especially when, as at present, they have such a violent impact on the banking sector – have generally had profound and particularly long-lasting consequences for the real economy.
By contrast, the ECB’s purchases of bonds aim to ensure that our official short-term interest rates are transmitted in a proper way to the economy. Another difference is that the ECB fully sterilises the liquidity injected in the market through its SMP while this is not the case in the US and the UK.