Indeed, the increasing availability of labor-saving equipment and software, at declining relative prices and with improving delivery lead times, is arguably at the root of the loss of business pricing power in recent years.
“There is no generalised asset overvaluations in the euro area.” He acknowledges that quantitative easing is making investors take more risks because that is more profitable. “That is partly what we want to achieve through our programme, this so-called portfolio shift. The only danger is that the “search for yield” might get out of hand. We need to keep a close eye on that.