$616.70 6.81%
BTC · 5w

ECB Now Owns 66% of the Eurozone

The European Central Bank (ECB) balance sheet has increased to 66% of the $12.5 trillion Eurozone economy which includes Germany, France, Italy, Spain and 15 other European countries.

ECB’s balance sheet has reached a new all time high of €6.7 trillion as it keeps on printing with total assets rising by another €17.8 billion mainly on Quantitative Easing.

ECB’s balance sheet now equals 66% of the Eurozone Gross Domestic Production (GDP), while Fed is at 37% with the Bank of Japan standing at 136% of their GDP.

ECB’s balance sheet, October 2020

In the past four years ECB’s balance sheet has risen by more than 3x, with some $3 trillion added to it just this year.

The amount of money printing therefore has reached new levels, but the euro has maintained its purchasing power and has even increased it.

In fact, while inflation and even hyperinflation is a problem in some countries, here we have deflation.

Eurozone inflation rate, October 2020

Prices are falling in Europe even while tons of money is printed, something that clearly indicates there’s a very big problem here with the way the fiat block reward is distributed.

Just like in bitcoin miners get 6.25 BTC per block based on Proof of Work, in the euro, the central bank and to some extent the commercial banks get the interest in this $3 trillion they have printed through Proof of Authority (PoA).

The block reward in the euro therefore is not quite the $3 trillion, which is printed then destroyed when it is re-payed, although it is a temporary block reward for the receiver with Proof of Authority used again to decide who receives it.

The actual permanent block reward however is the interest paid on this $3 trillion which becomes permanent money.

This $3 trillion enters the economy through a very centralized route. The commercial banks give out mortgages or lend to the government, the central bank then buys these mortgages or bonds from the ...

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