THE OLD BEN AND MARIO SHOW (September 11, 2012)

Stockmarkets are down only a few days after the surge following Mario Draghi’s money-printing promises. The president of the European Central Bank is out of the limelight already. But the plunge comes only a few days ahead of the Federal Reserve meeting that promises more money printing by Ben Bernanke, its chairman. Although investors are hopeful of yet another round of quantitative easing, they also realize that there are many bad signs all around the world: weak job growth in America, deepening recession in Europe, and slowdown in China. So, how come that the old Ben and Mario show is still going on? What can investors possibly expect from the two central bankers? In the short run, money printing helps a bit, but it only contributes to inflation in the long run. However, the real economy cannot be helped by either Draghi in Europe or Bernanke in America. Monetary policy cannot possibly replace fiscal policy no matter what tricks the two entertainers come up with. The only imaginable reason why the show still goes on is that investors have nothing else on offer anywhere they turn. Endless entertainment goes on, but the fun is ever shorter lived. And ever more ridiculous. Perhaps it is time for Ben and Mario to call it a day. Curtains, anyone?