The Effectiveness of the Single Mandate of the ECB and the Dual of the Fed

In the current work, we discuss and measure the effectiveness of the recent (2008-2018) monetary policies of the European Central Bank (ECB) and the U.S. Federal Reserve (Fed), which are two new and distinct monetary policy regimes. First, the Zero Interest Rate Regime (2008:12-2015:11) and then, the New Regime (2015:12-present) with a rate from 0.50% to 2.50% and to 1.25% (recently) in the U.S. and the different European policies with a very high interest rate in ECB from 3.75% to 0.00% and lately, to -0.50% (since September 18, 2019). This late reaction of the ECB, made the two central banks’ policies incomparable and the EU debt crisis deeper. These, dissimilar monetary policy regimes, have various effectiveness and provided distinct outcomes for the two economies. The analyses suggest that it was the Fed’s quantitative easing and the interest on reserves the main causes of the negative real interest rate following the financial crisis and the new bubble in the financial market. In Euro-zone, the answer must be that a common, the 21st century newborn currency and monetary policy for all these completely different economies do not work; countries need their domestic independent public policies. JEL classification numbers: E52, E58, E4, E44, E23, D69, D60