Europäische Geldpolitik – Auf dem Weg zur Modernen Monetaristischen Theorie

We show that actual Eurosystem’s monetary policy of purchasing government bonds of the countries of the Eurozone corresponds to the concept of Modern Monetary Theory. Here the state creates and skims off the required money supply for its expenditures himself. The economic policy challenges emerging from the expanded monetary basis in the Eurozone as consequence of the government bond purchases are substantial. We stress that European monetary policy should therefore immediately address the task of reducing the monetary basis and at the same time limiting possible adjustment costs for the European economies. This should take place within an institutionalized monetary management framework.