Prompts: In general, explain the actions of the European Central Bank (the European counterpart of the US Federal Reserve) in terms of what we've learned in class--why are they holding rates low? Why are they starting to purchase bonds in large quantities? How would this explain the analysts' expectations of growth of GDP increasing from 1.0% to 1.5%? Why is what Europe does important to the United States? Why might the United States be tapering off their Quantative Easing (purchasing bonds at a high rate) recently, and what might have prompted the European Central Bank to start purchasing bonds at a high rate?
Why the focus in interest rates and unemployment and why can they keep the interest rates low? How do bond purchases tie in with the interest rates?