ECB Governing Council member and head of the German Bundesbank Jens Weidmann has warned against the ECB handing out cash to stimulate growth.

He said helicopter money isn’t manna falling from heaven, but it would rip huge holes in central bank balance sheets and the euro area member states and its taxpayers would have to pay the bill in the end.

He also didn’t seem too happy about the general direction of the ECB policy overall. “I’ve always said the effect of ultra loose monetary policy gets weaker the longer it lasts. At the same time, the more you put your foot on the gas, the bigger the risks and side effects become,” he said.

In my opinion, this is  more than a Pavlovian plutonic reaction to the excesses of Draghi’s monetary policy agenda.

It’s a fact, the ECB has cited the Swiss case whereby the Swiss National Bank has applied negative interest rates of  0.75 percent as an example of what radical monetary policy can achieve, and we could say that’s all well and good.

However, what many people don’t know is that the Swiss policy of negative rates was aimed more for weakening the overvalued Swiss Franc than on stimulating Swiss bank lending, which is just as well as banks in Switzerland have responded to attacks that negative rates represent by raising the real world cost of borrowing in order trying to recoup the cost of the negative tax rate, notwithstanding that was perhaps an unintended consequence of these negative rates.

After the Swiss National Bank activated end-January 2015 negative rates at 0.75 percent, the situation actually lead to tightening of the credit standards at Swiss banks as they raised their mortgage rates for 10-year loans.

However the ECB’s policy position has been taken in the hope to increase banking lending, but, unfortunately demand isn’t there. As the saying goes: “You can lead a horse to water, but you can't make it drink.”

Investors could do well keeping in mind the euro area isn’t out of the woods yet, and not by a long shot.

Benoît Cœuré of the Executive Board of the ECB said in a prepared speech: “The measures we announced on 10 March 2016 form a very substantial package which gives priority to loans for households and businesses, and thus supports the recovery … But the ECB cannot single-handedly create the conditions for a sustainable recovery in growth. This requires a concerted effort in terms of economic and fiscal policies.”

The recent Swiss experience may therefore raise legitimate concerns about aspects that the ECB cannot control and which are, but not restricted to, "concerted" economic and fiscal policies of all Euro area member states.

From his side, Richmond Fed President Jeffrey Lacker said in a prepared speech: “Inflation has been held down recently by two factors, the falling price of oil and the rising value of the dollar. But neither factor is likely to depress inflation indefinitely. After the price of oil bottoms out, I would expect to see headline inflation move significantly higher,” which makes his speech interesting in context of the recent Fed decision not to act.

Lacker clearly sees inflation coming. It is already clearly visible in the rising U.S. inflation swaps.

Markets have to decide the extent to which this March FOMC was a mirror of last September FOMC. A hiatus to allow markets to recognize the economic realities against the extent at which it reflects a growth concern sufficiently strong as to where’s inflation evidence.

All this makes me think Goldman Sachs' expectations we’ll have 3 rate hikes this year has a high probability of being right under normal circumstances in the U.S.

Etienne "Hans" Parisis is a bank economist who has advised global billionaires and governments on the financial markets and international investments. To read more of his articles, GO HERE NOW.