Posted by WARREN MOSLER on November 9th, 2012
I guess he doesn’t realize the bond buying is about solvency, not aggregate demand.
Probably didn’t teach that at MIT or any of those other fancy places:
He was born in Rome, where he studied at the Massimiliano Massimo Institute and graduated from La Sapienza University under the supervision of Federico Caffè. Then he earned a PhD in economics from the Massachusetts Institute of Technology in 1976 under the supervision of Franco Modigliani and Robert Solow. He was full professor at the Cesare Alfieri Faculty of Political Science of the University of Florence from 1981 until 1994 and fellow of the Institute of Politics at the John F. Kennedy School of Government, Harvard University (2001).
Draghi Says ECB Stands Ready to Buy Bonds as economoy weakens
(Bloomberg) European Central Bank President Mario Draghi said the economic outlook is worsening and the bank stands ready to activate its bond-purchase program if governments fulfil the necessary conditions. “We are ready to undertake” Outright Monetary Transactions, “which will help to avoid extreme scenarios,” Draghi said. “It’s entirely up to Spain and the Spanish government to take the decision,” Draghi said. At the same time, “since the OMT announcement there have been a series of improvements” on financial markets, including “a return of flows from the rest of the world,” he said. “Certainly the outlook is being revised and there’s a picture of a weaker economy,” he said. “The Governing Council decided to keep interest rates unchanged. We have not discussed what we’re going to do next year in terms of monetary policy.”