The world's top two central banks have administered extra-strong monetary painkillers, but the global economy will still need a lot more time to recover from its thumping debt hangover.
Financial markets were euphoric after the Federal Reserve surpassed expectations and promised on Thursday to keep the money taps fully open until the U.S. labor market makes a sustained recovery.
The European Central Bank had already impressed investors a week earlier by pre-announcing unlimited, albeit conditional, secondary-market purchases to bring down sky-high yields on bonds issued by struggling euro zone members such as Spain.
Now it's time to come down to earth.
Surveys due this week are likely to show why, in the words of Stephen Cecchetti, the chief economist of the Bank for International Settlements, there are no grounds for complacency.
Global financial reforms are not yet complete. Southern Europe has not solved its fiscal problems and lack of competitiveness. And the world economy is listless, he said.
Read more: http://www.reuters.com/article/2012/09/16/us-economy-global-weekahead-idUSBRE88F0ET20120916
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