Critics called Draghi's comments "cheerleading bluster" and a "bluff to get through summer." Market action was short-covering.
Germany's Finance Minister Wolfgang Schauble rejects ECB hyperbole. "Welt am Sonntag," he said. "No, this speculation is not true."
Bailing out Spain tops Draghi's agenda. A 100 billion euro package is agreed. No more, says Schauble. ECB backdoor Spanish bailouts violate Germany's constitution.
He nixed an additional 300 billion euro lifeline. Europe's ESM (European Stability Mechanism) won't be operational until fall. At the same time, Spain's funding needs way exceed 100 billion euros. They may be tenfold that amount.
At issue is who'll supply it. The Bundesbank and German ECB members oppose dramatic action. After Draghi spoke, they expressed opposition to more bond purchases.
The Bundesbank opposes letting the ECB have sovereign debt monetizing power. Its mandate prohibits it. Officially, Draghi hasn't said he wants it. Unofficially, his July 26 bluster may lack muscle enough to overcome opposition to his comments.
Moreover, if the ECB and Fed act, will it be enough? Enormous sums on both sides of the Atlantic are needed.
Most important is bailing out banks and sovereigns at the expense of letting deep-seated problems fester and grow assures levels no amounts can resolve.