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7/22/2016 In the shadow of quantitative easing, party like it is 1788 - FT.com ASIA. INSIGHT OUT. FIND OUT MORE > WIERE! ASIAN REVIEW FINANCIAL TIMES ———-._.—— Click here to try our new website — you can come back at any time November 27, 2015 8:05 pm In the shadow of quantitative easing, party like it is 1788 John Dizard Quantitative easing is leading to the insolvency of insurers and pension plans, says John Dizard A time traveller from 2010 to today’s Europe would be shocked by what they find. The borderless Schengen area is now festooned with immigration and customs barriers, and financial markets are assuming ever-ballooning asset purchase programmes by the , European Central Bank that stretch into an indefinite future. Oh, and a president of the European Commission who says the single currency makes no sense when the Schengen agreement fails. So then, in this world, what would be the “risk-free rate” that institutional investors can use in their investment analyses? These problems are getting to the point where they not only threaten life in Europe as we know it, but our very careers. America and Canada can afford to make a lot of policy mistakes without social dissolution; Europe cannot. Specifically, the ECB and its member banks’ quantitative easing is leading to the insolvency of life insurers and defined benefit pension plans. This is no longer a worst-case scenario, but the most likely outcome of the present policy course. Perhaps a couple of years ago this could have been dismissed as so much journalistic whingeing, but now we are getting these projections from eurozone central banks. http://www. ft.com/cms/s/0/aa7a54d6-94f2- 11e5-bd82-c1fo87bef7af.html#axzz4F SIV2RAR 1/3 HOUSE_OVERSIGHT_023567