THIS week millions of people in the Netherlands celebrated the national holiday by getting up at dawn, staking out a patch of pavement and selling off their junk. The traditional King’s Day flea market gives the Dutch a chance to indulge in their favourite pastime: bargain-hunting. Their eastern neighbours are just as frugal. “Germans love saving. They think there’s something morally inferior about people who borrow,” says Reint Gropp, a German economist. In both Dutch and German, the word for debt also means “guilt”.
Their taste for saving and aversion to borrowing helps to explain why both countries’ citizens have lots of money in their saving accounts. This seemed to serve them well when interest rates were high. But in recent years, as rates hovered near zero, Europe’s best savers grew angry that their thrift was not rewarded. Now they have found a scapegoat: the European Central Bank and its suspiciously Italian chairman, Mario Draghi.
This month Germany’s finance minister, Wolfgang Schäuble, attacked the ECB’s policies of negative interest rates and quantitative easing, blaming Mr Draghi for the rise of the populist...Continue reading
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