The European Central Bank is officially out of ammo:

Germany’s central bank is willing to back an array of stimulus measures from the European Central Bank next month, including a negative rate on bank deposits and purchases of packaged bank loans if needed to keep inflation from staying too low, a person familiar with the matter said.

A negative rate on deposits is the last act of a desperate central bank. It could also been seen as a stealth method for implementing Europe’s long-sought-after “wealth tax.” Whatever you want to call it, it will hurt the middle class more than anyone else. The poor will get their subsidies and the rich will move their money and assets to safer locales or equities.

And right before hitting “Publish” another story caught my eye:

The ZEW Center for European Economic Research in Mannheim said its index of investor and analyst expectations, which aims to predict economic developments six months in advance, slid to 33.1 from 43.2 in April. The gauge is at the lowest level since January 2013. Economists forecast a decline to 40, according to the median of 33 estimates in a Bloomberg News survey. The index has dropped every month since reaching a seven-year high of 62 in December.

Investor caution in Europe’s largest economy reflects concern that the slow recovery in the 18-nation euro area leaves it vulnerable to shocks.

High taxes, big subsidies, and centralized decision-making have become the model here, too, yet somehow we remain as “vulnerable to shocks” as Europe.