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On the miracles of structural reforms - stpioc - 03-12-2016
They don't actually help a great deal when the problem is a significant output gap (that is, insufficient demand) and facing already strong deflationary pressures:
Quote:Pointing out that structural reforms tend to be deflationary in the first instance, he states: “Structural reforms are essential for long-term potential growth, but it is difficult to see how they could spur growth significantly in the next two years, especially when the current problem is lack of global demand”. We agree, and it is refreshing to see the ECB acknowledge this so openly.Everything Was Working Great... And Then Today's ECB Blog Post Left JPMorgan "Dazed And Confused" | Zero Hedge
That doesn't mean that at structural reform should be neglected, it means that it's not a miracle cure and might very well worsen the situation in the short-run.