The ECB

It got brought up today, in a business commentary piece....that almost 2.6 trillion Euro have been 'pumped' by the European Central Bank (ECB) into the EU market....with almost nothing positive to show. 

So one economist....Daniel Stelter, went out and suggested (yeah pretty radical)....they should have just given every single adult in the EU, 10,000 Euro (roughly $12k).

The logic in this idea....people at the lowest level know what to do with the money.

Around fifteen years ago, the Bush team decided that things were bad off, and that they would invent a tax relief check out of thin air (it depended on your level of income and taxation for the amount).  Me?  I was making around $80,000 a year at the time, but living overseas, and the overseas credit fell into place.  So my total taxes were less than $1,000.  My relief check?  Roughly $50.  It was enough to pay for one of the four new winter tires I was going to buy.

I have to say that I agree with Stelter to some degree.  Most average people would take a 3,000 Euro check and spend it within 90 days.  The exception?  Germans.  If you gave the typical German 3,000.....they'd stash 80-percent of it in a 1-percent interest saving account and spend the rest on some new washer or dryer. 

If you need an economy to pick up.....handing people some loose cash is generally a wise idea.  I'm not saying 20,000 Euro per person, or even 10,000 Euro.  But people usually know how to receive cash like this, and flush it into the market-place. 

In the case of the Germans....you'd have to hand them a debit card loaded with the cash, and tell them in a blunt way.....you have 30 days to spend it or loose it. 

As for the ECB now?  Well....it wouldn't shock me if they flushed another two trillion Euro into the system.  And later?  Find that it didn't do much either.