Can You Get Herpes On The Chest

& Trichet, the announced interest rate adjustment and reform

this morning reading the newspaper I almost swallowed the coffee. Trichet said that interest rates should rise ..... The announced rate hike of the ECB may perhaps be understandable if the ECB would be the old German Federal Bank, the anticipatory would prevent an overheating of the German economy through a D-mark appreciation. But the euro is not the D-Mark, the euro area, not Germany, and imported inflation is not appropriate in the current situation to announce a policy of restraint. Why is not a good idea is argued Kantoos Economic s in a post worth reading, entitled "Is Trichet out of his mind .....". Read oneself, only the Zusammfassung:

1. nomimale The gross domestic product is below trend growth and falling!
2. The 2% inflation target is a heterogeneous EU too narrow. A higher target would be appropriate.
3. inflation driven by global demand or adjustments to new equilibrium is for countries with weak demand, no reason to take a restrictive monetary policy should not second-round effects are visible.
4. Who wants to have a hard money policy as soon as possible, should the monetary policy in a first step make very aggressive expansionary. It cited Kantoos Friedman, who said that low interest rates does not indicate a bargain, but to show that money was tight.
   
5. The European credit crisis is not over.

following graphic illustrates the findings of Economics Kantoos weak demand: the black line represents the nominal GDP is the euro zone (the quantities on the left axis), the gray line is the trend growth and the green line, the deviation from the nominal Wachtum nominal trend growth in% (right axis). The green line shows that the gap does not become a trend now but bigger.


closes Against this picture of the big macroeconomic development Kantoos that a purely inflation-oriented monetary policy (price stability), the crisis worse can:

If there is a slight chance for solving this crisis without even more damage, the peripheral countries need to grow ! How insanely incompetent do you have to worry about to be globally driven energy prices in a situation like this?

said in an interview with the press Peter Brandner that rising prices for food and oil are primarily real economic causes and means that there are no signs of strong inflation.