Global markets have been through a roller coaster over the last few months, as weakness in China, depressed oil prices and unprecedented geopolitical risks come from just about every angle.

With the Eurozone economy still sagging despite major strides from its largest economy, Germany, the European Central Bank and head Mario Draghi have expanded its stimulus package to combat the very real threat of deflation. The announcement includes more interest rate cuts (down to -0.4%), bond purchases (increasing it from 60 billion euros a month to 80 billion euros monthly), and even a potential subsidy to lenders.

Draghi added that this might be it for a while, at least in terms of interest rates: “The Governing Council expects key interest rates to remain at present or lower levels for long period of time and well past the horizon of our net asset purchases,” Draghi said. Based on the current view, “we don’t anticipate it will be necessary to reduce rates further.”

Bundesbank opposed

There have long been tensions between Germany’s Bundesbank and the ECB, especially regarding what’s necessary to get the rest of the Eurozone back on track economically. The German central bank fears that the ECB’s continued jumps into stimulus packages as its main monetary policy approach has the potential to spark “a doom loop of expectations and disappointment.”

After all, what incentive do struggling EU countries have to practice the same type of austerity Germany has championed throughout the recession and subsequent recovery if they know that the ECB will always be there to give them a hand?

Furthermore, increasing the bond purchase program is risky, according to the Bundesbank, as it could inflate asset bubbles and give a false sense of security to highly indebted governments who should be focusing more on reform.

A few thoughts in favor

It’s difficult to say exactly what could have happened had the ECB not stepped in a couple years ago to help the struggling Eurozone economy. Draghi, however, has an idea.