After a wild day in the markets yesterday, Mario Draghi, president of the European Central Bank, was at center stage this morning. What he said was almost incomprehensible to most people, including me. The clear takeaway was that European interest rates will not be going higher anytime soon. He was also asked what instruments the ECB have left to fight the current impasse in the markets. His answer was classic mumbo-jumbo Central Bank talk and did not address the question at hand.
It seems to this observer that the ECB and the Fed are literally out of ammo and have no clue what to do next. Fed chairwoman Janet Yellen's decision to raise interest rates here in the United States was, in my opinion, too late to have the desired effect. Should the markets head south as it looks like they may be doing, does the Federal Reserve have a backup plan or do they move rates back down again to stimulate the economy with another QE? Continue reading "The Head Of The ECB Speaks - What Did He Say?"