Monetary Policy, Financial Regulation and Financial Stability: A Comparison between the Fed and the ECB

In their paper, Gunther Schnabl and Nils Sonnenberg analyse in light of Austrian and Keynesian economic theory the impact of conventional and unconventional monetary policies as therapies for financial crises. Whereas the Fed focused on the stabilization of the banking sector, the loose monetary policy had a destabilizing impact on the financial sector in the euro area.