What a mystery. Mario Draghi lowers interest rates again, this time to minus 0.4%. And banks are still not lending out their excess reserves, even though they have to pay interest on excess reserves at the ECB. Credit growth has been lacklustering. What is going on? And why will Draghi’s loose monetary policy not even achieve the goals of Draghi himself?

It may have escaped your attention, but the Dutch have had their ‘Money Week’ last week.

During this annually recurring initiative of the Dutch government, ‘activities are organized in order to teach children on primary schools how to deal with money. A lot of those activities take place in the classroom, where financial professionals will, on request, provide free lessons and workshops. Among others, employees from banks, insurance companies and the municipal credit banks, will teach

The euro was supposed to become comparable to the Dutch guilder or the German mark; not like the Italian lire or the Greek drachma. In order to realize this goal, the common currency was built on two pillars: The European Central Bank (ECB) was designed to function as an independent central bank, modeled after the German Bundesbank. Furthermore, the Stability and Growth Pact imposed sound fiscal policies on all euro area countries. The latter was sorely needed given that, through the euro, French or Italian problems would become our mutual problem.... »