Economy

Draghi To The Rescue? New Bond-Buying Plan Unveiled To Help Boost Euro

LES ECHOS (France), DIE WELT, DER SPIEGEL (Germany), IL SOLE 24 ORE (Italy) BLOOMBERG (US), BBC NEWS (UK)

Worldcrunch

FRANKFURT – Aiming to squelch speculation of an impending demise of the euro, European Central Bank President Mario Draghi said policymakers have agreed to an unlimited bond-purchase program to regain control of interest rates in the single currency zone, reports Bloomberg.

The program “will enable us to address severe distortions in government bond markets which originate from, in particular, unfounded fears on the part of investors of the reversibility of the euro,” Draghi said during Thursday afternoon's widely anticipated press conference in Frankfurt.

The ECB will target government bonds with maturities of one to three years, including longer-dated debt that has a residual maturity of that length, said Draghi, calling the euro "irreversible."

Ahead of the announcement, the European Central Bank kept the benchmark euro zone interest rate unchanged at a record low 0.75%, as expected by most observers.

Italian Prime Minister Mario Monti said Thursday that the stakes are higher than ever, and called on politicians on the national level across the continent to stop blaming the crisis on demands that Europe is making, Milan-based business daily Il Sole 24 Ore.

“Rather than the ultimate fulfillment of (Europe’s) union of peoples, the euro paradoxically could become a major factor of its disintegration,” Monti said in a speech in Florence. “This would be even more harmful than the material consequences of the crisis. If we don’t increase the political and psychological vigilance, this will happen.”

However, Germany remains critical of the ECB. According a poll carried out by Der Spiegel, 42% of German citizens have little or no confidence in Draghi, while only 18% of Germans say they trust the current ECB President.

The German stock index (DAX) barely reacted to the news, reports Die Welt.

In the afternoon, the German index was still 1.30 percent higher at 7,055 points, but held up to the acclaimed 7000-point mark.

The ECB announced earlier today that it forecasts a deeper economic contraction for 2012. Euro-zone GDP will drop 0.4 percent this year instead of 0.1 percent, it said.

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Ideas

Saving The Planet Is Really A Question Of Dopamine

Our carelessness toward the environment could be due, in part, to the functioning of a very primitive area of our brain: the striatum.

Ad scuba-diver and brain coral

Stefano Lupieri

PARIS — Almost every week, a new scientific study alerts us to the degradation of the environment. And yet, we continue not to change anything fundamental in our systems of production and habits of consumption. Are we all suffering from blindness, or poisoned by denial?

In his popular books Le Bug humain (The Human Bug) and Où est le sens? (Where is the Sense?), Sébastien Bohler, a journalist in neuroscience and psychology, provides a much more rational explanation: The mechanism responsible for our propensity to destroy our natural environment is in fact a small, very deep and very primitive structure of our brain called the striatum.


This regulator of human motivation seems to have been programmed to favor behaviors that ensure the survival of the species.

Addictions to sex and social media

Since the dawn of humanity, gathering information about our environment, feeding ourselves, ensuring the transmission of our genes through sexual intercourse and asserting our social status have all been rewarded with a shot of dopamine, the 'pleasure hormone.'

Nothing has changed since then; except that, in our society of excess, there is no limit to the satisfaction of these needs. This leads to the overconsumption of food and addictions to everything from sex to social media — which together account for much of the world's destructive agricultural and energy practices.

No matter how much we realize that this is leading to our downfall, we can't help but relapse because we are prisoners of the dopamine pump in the striatum, which cannot be switched off.

Transverse section of striatum from a structural MRI image

Lindsay Hanford and Geoff B Hall via Wikipedia

Tweaking genetics 

According to Bohler, the only way out is to encourage the emergence of new values of sobriety, altruism and slowness. If adopted, these more sustainable notions could be recognized by the striatum as new sources of dopamine reward. But there's the challenge of promoting inspiring stories that infuse them with value.

Take the photo-collage exhibition "J'agis ici... et je m'y colle" ("I'm taking action here... and I'm sticking to it"), a collection of life-size portraits of residents committed to the energy transition, displayed on the walls of the French coastal city of La Rochelle.

Backed by the French National Center for Street Arts, photographer Martin Charpentier may be employing artistic techniques, but he's also tinkering with neuroscience in the process.

Les Echos
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