A Seeking Alpha Contribution
- European QE appears likely at the next meeting.
- In order to overcome German opposition, the QE program may favor northern European bonds and stocks more than anticipated.
- The bear market in the euro will continue in the wake of QE.
Back in December, ECB President Mario Draghi said consensus wasn’t needed for a QE program. The stumbling block in Europe has been several hard money nations led by Germany. These are the countries often lumped together as part of a northern euro block, such as Holland, Austria and Finland, who prefer a strong euro to a weak one. On the other side are the Greeks, Italians, Spanish and French who would do better with a weaker euro. Global investors are giving the south of Europe its wish by selling the euro, but a QE program would be a big help to nations struggling with unsustainable sovereign debts. If a QE program is launched, it will be good news for European equities, and due to the need to overcome German-led opposition, may benefit the north much more than expected…. To Continue Reading, Please Click Here.