The talk among many analysts now is about what will happen to Europe in 2015. Given the recent decline in economic data from some of the bigger players in Europe (save for Germany with record low unemployment), and Greece’s inability to conform to the needed cuts, thus the talk of Greece leaving the Eurozone, one might think 2015 for Europe will not be a good one. Think again.
Mario Draghi is riding in on his big, white horse and he will save the day. He is calling for the European Central Bank to make its biggest push yet to fend off deflation and revive the economy. He would like to see the ECB to release 1.1 trillion euros ($1.3 trillion) in QE. Now, keep in mind, this is the same program the US applied back in 2009 and it worked.
Draghi wants to spend some 50 billion euros a month through December 2016. This coming Thursday is the day of reckoning, and the plan does face some still opposition, but the reality is that what Draghi wants, Draghi gets, much like what Bernanke wanted, Bernanke got.
“By urging Fed-style quantitative easing, Draghi is remodeling the ECB as an aggressive central bank that will take risks even against the wishes of Germany, the region’s biggest economy,” reports Bloomberg News. The fact is Germany will go along. It has to go along. If he rest of Europe fails, Germany fails. Draghi will win this fight.
So, the play is Europe. When is now and how is up to you. The opportunities are there and more are on the way.
