It was John Maynard Keynes who invented the phrase “liquidity trap” to describe how central bank policies designed to resuscitate an economy could fail when interest rates get close to zero. Even though he was writing 70 years ago, he could have been describing the situation in the eurozone today.

Before the crisis, the eurozone's private sector raised, on average, about €1.2 trillion of capital a year via loans, bonds and equities to finance investment and consumption. Over the past year, in contrast, the private sector repaid €655 billion worth of capital. That is why using low interest rates to try to stimulate the 18-member bloc is not working - low interest rates only work if people are borrowing money. Without that, it's like pushing on a piece of string.