This type of stimulus is at least far better than buying government debt. Governments do not create jobs that truly contribute to economic growth because government produces nothing. Unfortunately, buying the corporate bonds from bankers will only means they are relieving the banks of paper they do not want. The ECB is hopelessly fighting against the head wind of deflation because they do not control the fiscal side of the balance sheet. That means which they try to stimulate the economy, we have the European Commission plotting against the economy by attempting to enforce taxation and raise taxes at every possible turn on top of creating a Byzantine system of serious over-regulation that prevent business expansion and formation.
The superficial view of how this will stimulate the economy is always good for a bounce as people trade within the noise of a market defines by resistance and support. However, the long-term prospects to this actually reversing the trend or “stimulating” anything is hopeless.
Full article: ECB Begins Buying Corporate Bonds (Armstrong Economics)