> The ECB has been "very accomodating to growth"? How? The unemployment rate
> in the Euro-zone is 9.1%. Yet real short rates are over 2%. The Fed would
> never let that happen here.
They certainly did. That's what happened in 1981-83, under Volcker, and due to a lack of a non-military industrial policy, US industry never really recovered (the US became a net debtor nation in 1985). Maastricht monetarism was a strange beast; the core economies of Germany and France preached austerity but practiced efficient, cynical domestic Keynesianisms (bank bailouts plus the buyout of the ex-GDR). It's true Italy and Spain had very, very high real rates of 4% or more in 1996-97, which nearly strangled their economies. Lucky for them, the EU saved their ass via structural funds to Spain (2-3% of Spanish GDP) and allowing Italy to run up huge export surpluses (northern Italy is one of the main subcontractors for French/German industry). But the ECB dropped rates in the EU to Central European levels, and kept them there. Profitability of the main Italian industrial groups, for example, seems to be recovering nicely. The most you can say is that the ECB has been the faithful tool of the Euroindustrialists.
-- Dennis