Pimco Sees a Liquidity Trap Gradually Unfolding in Europe

The video discusses the European Central Bank's (ECB) current position, suggesting it may be in a liquidity trap similar to Japan's past experience. It highlights the challenges faced by ECB President Christine Lagarde, as monetary policy seems ineffective in stimulating growth. The discussion suggests a shift towards fiscal policy, with monetary policy playing a supportive role, similar to Japan's approach. Asset purchases are identified as a potential tool for future economic support.

What potential changes at the European Council level could affect the coordination of fiscal policy?

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What role do asset purchases play in the context of the current monetary policy?

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