The Draghi Guarantee: the Glue Holding Europe Together

07.09.2017 • France

Simone Wapler – La Chronique Agora (France) –

Everything I have consumed, everything I have used this morning represents infinitely complex production and decision-making circuits. These circuits allow me to have more than what my only abilities could offer me.

The exit from “unconventional monetary policies” does not come from a source. To counter a future panic, measures againstcashmultiply.

My clock radio turns on this morning. The small electrons in the copper wires did their job well. I push my cloth out of Egyptian cotton woven in France (we have its weaknesses).

Mario Draghi is to indicate today the “monetary policy” that the ECB will follow.Poor Mario ….

In the kitchen, my gaze floats on the coffee encapsulated by a giant of the Swiss food industry. But, as always, I prefer the tea of ​​China, in bulk, infused in a big teapot.

On the radio, Jean-Claude Trichet, who occupied the position of Mario Draghi, gives serious opinion on what should make Mario and the difficulties of his decision-making. Inflation, potential growth, relative competitiveness, eurodollar, key rate, deficit, trade balance, blablabla …

My bread jumps from the toaster.

The hot water flows from my shower, like every day. Choice of clothes, quickly counts on the weather. Choice of my “metro book”, more complicated. Writing cut and weight are two important criteria.

Remount the last emails on my phone before hanging the metro …Leave me alone even for 10 years and I will not even be able to redo a simple bulb, let alone a led bulb. And, admitting that I succeed, who will supply me with electricity?Why tea in China rather than Brazilian coffee in the morning?

There is price and value. I value Chinese tea more than Brazilian coffee. At least in the morning. I do not care about the exchange rate between the euro and the yuan or the euro and the real. But I’m glad that Marco Polo opened the Silk Road and that in 1492 Christopher Columbus accidentally landed somewhere near Brazil. And there is the price, in euro, of my tea or coffee.

I am not alone in the world, there are billions of other bipeds. Some take chocolate, others prefer milk. Some of them run by subway, others by foot, by bicycle or by car.Price – value. What I like, what others prefer …

It is these billions of everyday decisions that Mario Draghi must influence with his monetary policy so that the average of these billions of decisions go in the “right direction”. In France, Spain, Austria, China, Brazil and the United States. Exchange rates, inflation, growth, …

This belief is simply inept.

Our omniscient central bankers do not know what to do with their “Rate”, “Print” and “Delete” buttons to adjust the amount of money in the economy. But even if they do nothing, they find a way to harm.

We see an expression returning more and more often in the Anglo-Saxon press:low wage growth” or “low wage, slow growth“. This could be translated as “soft growth at low wages”.

Since the end of the Jackson Hole meeting on August 25, the dollar has plunged and the Korean missiles have nothing to do with it.

On the other side of the Atlantic, at the ECB, our Mario Draghi is very annoyed. The anglophone press seems to believe mordicus that it will “do something” to prepare for the end of monetary creation in euro.

The Wall Street Journal, Tuesday 5 September 2017An expected ECB signal on the reduction of the monetary stimulus

“Investors are on the lookout, ready to drop Eurozone bonds and buy the currency as soon as the central bank gives a clear signal that its withdrawal from this market is near”

On the German side, we sweep the sword in Mario’s kidneys, who argue that the euro is already very strong. “We are totally relaxed in the face of the current strength of the euro … Neither the speed nor the extent of its appreciation are of concern to us,” Anton Börner, president of the German exporters and wholesalers’ federation, told Reuters.

Last month the German Supreme Court ruled that the EQ could be contrary to German law but ultimately pushed the case to the European Court of Justice in Luxembourg. Draghi’s monetary policy has become a hot topic of the German campaign and the elections are on 24 September. The Germans are furious about the rise in real estate that it has aroused. Price – value … The Germans do not give the same value as the French to the real estate, less affective for these goods.

How does this affect us?

If the infinite and free credit is no longer guaranteed by Mario Draghi, everything collapses: Greece, weak borrowers, bond bubbles, real estate, banks leaded bad debt. It’s back to the 2008 box, worse. As bad debts and bad loans have multiplied.

To force us to leave our money in the banks, the war against thecashintensifies.

In Italy, craftsmen and traders will be obliged to offer their customers to make electronic payments. Small shopkeepers and craftsmen argued that terminal payment charges in some cases amounted to € 550 per month,The echoes

In France, La Poste no longer offers the mandatecashurgent. It will be necessary tocashwith which money is only available within 24 hours.

In Portugal, the new law L92 / 2017, which came into force on August 23rd, limits the use of cash to € 3,000 (€ 10,000 for non-residents). It’s less worse than France, but it’s a good start.

Control of our money, for what?

But let us finish on a gay note. In Greece, everything is better, boasts Les Echos!

Comment by my colleague who drew my attention to this article:

“I figured that the measure had to be significant after two years of capital control but it is far from being a return to normal.

Basically the Greeks could withdraw 840 € every 15 days or 1,680 € per month. But that was before.

Since 1 September 2017, they can withdraw 1800 € per month either120 € more. That’s wonderful !

– June 2015: 420 € per week.- First reduction in July 2016: 840 € every 15 days, the same monthly amount.- Second reduction this summer: € 1,800 per month or a real monthly relief of € 120 over 2 years.

In one year, they may be able to withdraw 120 € more per month … “

All this to save bankrupt banks and allow the Greek government to go into debt again with the bail of European taxpayers.

Should I prefer feta for my breakfast to support Greece?

“The value that each gives to money is the value he gives to the goods he thinks he can buy with that currency. It depends in particular on the available goods and on the total quantity of available currency.


Creating money creates no real wealth, but gives rights over real property to those in whose hands the currency appears without having contributed to the creation of goods. Whatever the author, this operation benefits those in whose hands the money appears and weighs the present possessors of money.

B. A. BA in economicsGérard Dréan

Can we strike the currency? Yes of course. By using gold and / or silver (I will have to convince Nestlé and my baker) or by taking an interest in cryptomonies.

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More Mario Draghi “will do whatever it takes” by playing with the euro, the more your chances of winning increase by playing with the cryptomonies.

Poor Mario …

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-Read more at (French)-

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