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Opinion
Krishna Guha

Can Mario Draghi Beat Deflation?

Buying bank loans is the best way for the ECB to protect the euro area from the specter of deflation.

The European Central Bank may soon have to roll out the heavy artillery, in the form of an asset purchase program similar to those in the U.S., U.K. and Japan, to fight the specter of deflation. But in a currency union with 18 different sovereign bonds, the tough question will be what to buy.

The best solution: Purchase loans from banks -- what I call euro quantitative easing in bank loans.