> They're doing it at a rather leisurely pace, aren't they? Faced with
> profound stagnation in the early 1990s, the Fed pushed real U.S. short-term
> interest rates down to 0% and kept them there for a couple of years; real
> rates in the Eurozone are still over 2%, and budgets are still tight.
Euroinflation is 0.8% the last I checked, which means real rates are down to 1.7% or so. More importantly, rates in Italy and Spain have dropped quite dramatically in the last year, from chokingly high 6% rates to the 2.5% standard today. It's true that they waited far too long to do this, but then, per capita growth in the EU has been stronger than in the US during most of the Nineties anyway, so the sense of urgency probably wasn't there. It does seem to be there now -- currency amalgamations seem to concentrate the rentier mind wonderfully.