Yes, The ECB Chief Economist Really Said It: "If You Print Enough Money, You Always Get Inflation. Always."

Once upon a time there was a cute, if amusing and terribly disingenuous debate among those who have never actually traded but pretend to know finance, about what QE and "unconventional policy" actually was. "It's an asset swap" they said, "it's not printing money" they said.

We are happy to close the chapter on all those sophist hacks once and for all, with a painfully obvious, if stunning in its honesty, declaration by none other than ECB Executive Board Member Peter Preat, who earlier today said the following: "If you print enough money, you always get inflation. Always."

The full context from Reuters, which reports that "money-printing plan has so far failed to drive up inflation" and touches on Europe's odd fascination with never having a backup plan: "the bank does not have an alternative "plan B", ECB Executive Board member Peter Praet said in a magazine interview published on Wednesday.

More details:

"I accept that our policy has not yet been successful: inflation in Europe has for a long time been at a very low level of almost zero," Praet, the ECB's chief economist, told Belgian weekly magazine Knack.


Praet said various factors, notably low oil prices and less buoyant emerging economies, meant it was taking longer to reach the goal of inflation of close to but below 2 percent.


"We need to be attentive that this shifting horizon does not damage the credibility of the ECB," he added.

Too late, friend.

Inflation has missed the ECB's target of close to but below 2 percent for almost 3 years and it will still take years at best to drive up price growth towards the target, the bank forecast earlier.


Praet said that, despite this shifting horizon, the ECB did not have an alternative to its policy of low interest rates and 1.5 trillion euro asset buying scheme.


"There is no plan B, there is just one plan. The ECB is ready to take all measures necessary to bring inflation up to 2 percent. If you print enough money, you get inflation. Always. If, as is happening now, the prices of oil and commodities are tumbling, then it's more difficult to drive up inflation," he said.


"If a whole series of such things happens, then you can only shift the date by which you will achieve higher inflation."


Ah yes, when reality "happens", and screws up the excel spreadsheet which central planners had in mind for the next 5 year plane, one can only extend and pretend, hoping that eventually one will be right.

And, finally, the punchline:

Praet said he remained confident that the stimulus would drive up inflation however, adding: "If you print enough money, you always get inflation. Always."

And with that we can finally close the book on slippery central bank semantics on what precisely it is that they do, and what it is they plan to achieve.

Finally, here is the post-script to Mr. Praet which we have been repeating since day one: "If you print enough money, you always get hyperinflation. Always."