Picking up the pieces from the ECB’s QE

Mario Draghi, head of the European Central Bank
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Mario Draghi, head of the European Central Bank

I had to laugh. Watching the CNBC panel at the World Economic Forum last Friday in Davos, the German Finance Minister, Wolfgang Schauble, kind of stole the show in his dry, wry way.

Having been one of the biggest critics of the European Central Bank's quantitative easing (QE) program from the start, he walked a delicate line defending the German position a day after the ECB unveiled its full scale, 60 billion euros a month stimulus measures.

He spoke about how he respected the independence of the ECB: "I don't comment on decisions by the ECB. Never ever."

He reiterated that Germany wants to see the euro zone stick together: ' We did whatever could be done to support Greece through difficult times, again and again…We had to convince the IMF to come up with very extraordinary conditions, in line with IMF rules, so that we could support Greece."

Read MoreSoros: ECB QE means inequality and asset bubbles

And when billionaire legendary investor, George Soros, offered his views on Germany, Schauble stepped in saying that Soros perhaps wasn't the best person to ask: 'If I (Schauble) am asked on German fiscal policy, I have to explain, because I know it better than anyone else'.

Soros, incidentally, was following a more cautious line. He spoke about how the ECB's move could have unintended consequences for the market, creating possible asset bubbles. His main concern though was that quantitative easing would make the gap between the rich and the poor that much bigger, as it would benefit the owners of assets. One area where Schauble and Soros agreed is that it isn't smart only to rely on monetary policy. As Schauble said: 'I don't believe monetary policy alone can produce growth'.


While monetary policy might not be enough to insure fundamental growth, I always like to say: "Don't fight the trend, my friend, as it's YOUR friend until the bend in the end." And indeed, it seems almost all asset classes are getting a taste of this.

Read MoreWe were right on 'big and strong' QE: ECB's Coeure

Peter Oppenheimer, the chief global equity strategist from Goldman Sachs, is just one of the many experts who have said that the ECB measures will give even more support to stocks.

But it's not just stocks. We ponder where to hunt for yield so often…what hunt? What yield? Well, apparently, a hunt that includes record low yields across the board in debt markets. Bonds continue to indiscriminately hit record highs -- whether looking at German, U.S., Spanish, Italian, Portuguese, U.K. or Scandinavian bonds. Seems the thinking is that if the ECB will be buying, so will we.


When it comes to other big moves at the moment, the euro is still going bananas (...to the downside, that is) after the ECB's QE announcement. For the first time since September 2003, the euro dropped below $1.12 at the very end of last week. The biggest question I'm hearing at the moment is whether parity or sub-parity is a possibility for the euro/dollar this year.

One thing is certain: while a much lower euro continues to be a headache for the Danes -- two rate cuts in a week to stem the rising euro-pegged krone -- and the Swiss -- having just dropped the Swiss franc peg to the euro, the Swiss National bank has said it will still be intervening if necessary. But a lower euro is great news for the ECB. European exports suddenly look more attractive and import prices lead to better inflation projections. All in all, nobody in Europe at the moment is against a more competitive Europe. If we were to hit parity in the near future, though I wonder whether we'll be complaining about it having dropped too quickly and the upset in international trade balances it's causing.

- Louisa Bojesen is the Anchor of CNBC's European Closing Bell, M-F 4-5pm. Follow Louisa on Twitter @louisabojesen