QE in America is a lot simpler than it is in Europe. In the US, the centralized authority, the Federal Government has a much cleaner connection with its Central Bank as well as stronger authority over its domain than the EU has over its member states. Each EU member has its own debt which is not equivalent to another member’s debt.
Unlike the Federal Reserve which could step in and buy US treasuries, the ECB can’t go and buy EU bonds. It has to go and buy bonds from individual members. So a question arises in which members’ bonds should the ECB buy and how much per member should it buy?
To make matters worse, the Germans who stand in the way of QE in the EU have put their foot down. They don’t want it. They don’t want it so much that they are going to balance the budget for the first time in 45 YEARS! Yup, it’s been over four decades since these guys have balanced a budget and somehow they are considered the most fiscally conservative EU member… I know right.
The point is. Germany is serious. They want the other members to somehow magically get their shit together, which let’s face it, won’t happen without serious structural changes and of course that won’t happen without a serious collapse.
In short, QE ain’t coming to the EU any time soon. Look for things to get even worse in Europe. And if you don’t believe me, perhaps a quote The Ben Bernanke will change your mind. When asked if the ECB was going to do Quantitative Easing Ben responded:
“The barriers to doing it are not really economic. The legal and political barriers being thrown up are going to make it very difficult to do that.”