A cheeky note from Evelyn Herrmann at BNP Paribas reminds us that the Bundesbank carried out its own quantitative easing in 1975. The central bank bought 7.6bn D-mark of post, telecom and sovereign bonds between May and October 1975. This was equal to almost 1pc of German GDP. Buba acted because the economy had tipped into recession and long bond interest rates were moving dangerously high. The bank did this during an inflationary phase when bond vigilantes were pulling back from Bunds and other government bonds for fear of default – ie stealth default through inflation rather than non-payment, but default ... (full story)