Last week, the European Central Bank announced its version of quantitative easing. Even Russia decided to lower interest rates last Friday. This was yet another attempt by a central bank to devaluate its currency more than other central banks. The Russian central bank was the fourteenth central bank to undertake an (even) more expansive monetary policy. Currency devaluation is the policy choice of... »
What Will Happen Next in the Worldwide Currency War?
February 2 2015
Olav Dirkmaat
Three Secrets about Draghi's 1,140 Billion Bazooka
January 26 2015
Last Thursday, Draghi — with his distinctive Italian accent — announced that the ECB will undertake its largest stimulus program ever. From March onwards, the ECB will purchase €60 billion worth of government bonds each month. The program will run for nineteen months and will amount to a total of €1,140 billion (around 8.8% of Eurozone GDP). After this announcement, the euro... »
Olav Dirkmaat
Three Events That Will Set the Tone for 2015
January 19 2015
January could very well turn into a highly memorable month. Later this month, the ECB and the Federal Reserve will indicate their intended policies for 2015 on January 22nd, and January 27th/28th respectively. The Greek elections are just around the corner and many companies will publish their... »
Olav Dirkmaat
What Central Banks Did in 2014 and Will Do in 2015
January 12 2015
2014 was the year in which the Federal Reserve announced to end its quantitative easing (QE) stimulus program. As a result, it was the year of the dollar. The dollar rose relative to all currencies. The euro also declined heavily and now trades at only $1.19 as opposed to the $1.39 it traded for mid-2014. Many investments denominated in U.S. dollars correspondingly increased in value. U.S. st... »
Olav Dirkmaat
