STUDENT: In the indirect it obviously starts from that income and then the first item should be depreciation Is that the way that we should go?

Nothing like that has happened in Europe - yet. But it's certainly within the realm of possibility, especially as the pain of austerity and internal devaluation drags on.

But after years of low or no growth, a sharp currency depreciation could be a last resort to kick start the economy.

But that is the effect of relative dollar depreciation.

In order to prevent devaluation of their dollars, they have no option but to keep buying yet more dollar-denominated securities.