The underlying reason why the ECB's monetary policy is not effective

It is important to see that the ECB's very expansionary monetary policy since 2013-2014 has not at all rebalanced euro-zone savings and investment, and has therefore been ineffective. This ineffectiveness is fundamentally due to following mechanism: There is a structural, behavioural savings surplus in Germany and the Netherlands; And since the euro-zone crisis (2010-2013), the other euro-zone countries have been subject to an external balance constraint: they can no longer have an external deficit since Germany and the Netherlands no longer want to finance it. As a result, the ECB’s expansionary monetary policy cannot lead to an increase in investment in euro-zone countries other than Germany and the Netherlands, as this would result in an external deficit for these countries. The situation would be quite different, and the ECB's monetary policy would become effective again, if Germany and the Netherlands were again willing to lend their savings to finance investments in other euro-zone countries.