Yesterday's Ballsy Short was about Eurozone deflationary expectations and my perennial whinge about Quantitative Expansion. Next month, it looks like ECB President Draghi will ramp up Euroland’s QE. Question is: will this liquidity reach smaller businesses in Europe. This chart from an article in today’s International New York Times entitled “Little guys still face a euro credit crunch” shows the high cost of SME loans in Euroland when the ECB base rate is currently a negligible ¼%! How can SMEs grow with rates like this? With the coming deflation and no growth how can periphery Euroland ever repay debt?
