| Boris Johnson wasn’t the only one being criticised for responding slowly to the social and economic crisis caused by the coronavirus. The European Central Bank was also slow to act. Last week, when remarking that the ECB was “not here to close spreads”, bank chief Christine Lagarde caused a rapid spike in yields on Italian government bonds. That misstep was partially redeemed on Wednesday (18 March) by the announcement of a new quantitative easing programme worth an additional €750 billion that should be targeted at the countries hit hardest by the pandemic. Italy, already burdened by its high debts and suffering the highest number of coronavirus cases and deaths in Europe, is likely to take a correspondingly high economic hit. Without co-ordinated state intervention on an unprecedented scale, millions of Europeans will lose their jobs. One of the differences between the response to the COVID crisis and the 2008-09 eurozone crisis is that this time, everybody believes that governments and central banks must do “whatever it takes” to shield businesses and workers from the worst of a deep recession. No bazooka is too big. (...Click here to continue reading...) | 
