There is no doubt that high-debt countries, and Southern European countries in general, have benefited enormously from the "whatever it takes" of Draghi. There is little doubt that the decline in interest rates on their public debt has encouraged them to take it easy in terms of their fiscal policy, after some effort aroun 2011 and 2012. This is a very standard moral hazard problem of loose monetary policy. However, there is a huge uncertainty regarding the appropriatness of a very tight fiscal policy in these countries anyway; in addition, none of them gives signs of sheer fiscal irresponsibility, just some relaxation. In light of this, again prudence would suggest accepting these side costs and continuing with the current monetary policy for some time.
It is true that the current level of low nominal interest rates probably has adverse effects on the functioning and profitability of banks and especially insurance companies (the latter especially in Germany because of specifici regulation in that country). These effects are however not well understood yet. On the other hand, inflation in Europe is still extremely low, and displays very few signs of increasing. Given that most of Europe is still doing between OK and badly in terms of output growth and output gap (whatever that is ....), prudence would suggest continuing with the present monetary policy at least until inflation shows some signs of rising.
About the CFM Surveys
The CFM surveys informs the public about the views held by prominent economists based in Europe on important macroeconomic and public policy questions. Some surveys focus specifically on the UK economy (as the CFM is a UK research centre), but surveys can in principle focus on any macroeconomic question for any region. The surveys shed light on the extent to which there is agreement or disagreement among these experts. An important motivation for the survey is to give a more comprehensive overview of the beliefs held by economists and in particular to include the views of those economists whose opinions are not frequently heard in public debates.
Questions mainly focus on macroeconomic and public policy topics. Although there are some questions that focus specifically on the UK economy, the setup of the survey is much broader and considers questions related to other countries/regions and also considers questions not tied to a specific economy.
The surveys are done in collaboration with the Centre for Economic Policy Research (CEPR).
German Council of Economic Experts' view of ECB policy
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Question 2: Do you agree that the ECB's monetary policy masks structural problems of member states?
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Question 1: Do you agree that exceptionally loose monetary policy by the European Central Bank is no longer appropriate?
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