A moment of silence is probably deserved.
Today ECB operation 20110149 passed into history.
20110149 was the first of the 3 year Longer Term Refinancing Operations carried out by the ECB 1,134 days ago. It provided nearly €500 billion of long term liquidity to euro-area banks at a time when the default of all of the peripheral nations seemed imminent, the euro currency itself seemed doomed and liquidity was as rare as agreement amongst economists.
ECB president Mario Draghi - who was then less than six weeks in the job - announced the two 3-year LTROs at the December 2011 press conference. (note, less than six weeks, but also 2 rate cuts in..)
The ECB knew that it would be allowing a carry trade for the banks under these LTROs, but at the time, a bank carry trade that involved banks loading up on sovereign debt, thereby forestalling any potential sovereign defaults. was a really, really good idea.
The excuse the ECB used at the time was the LTROs would increase liquidity in the market and thus help repair the momentary transmission mechanism. This was probably a little ambitious, but the 3 year LTROs did do something very important. They stopped the downward spiral of the euro area which had come dangerously close to tipping into outright collapse.
More importantly, the success of 20110149 helped build Mario Draghi's reputation.
Following on from the 'conservative' style of Jean Claude Trichet, Draghi very quickly put down a marker for the market that he would act decisively when it came to the crunch.
Without the reputation he'd built on the back of the success of the 3 year LTRO, it is less likely that 'whatever it takes' would have had the impact it did. I occasionally joke that OMT stands for Draghi's "Other Magic Trick". But the only reason that trick could be pulled off is the faith the market had in Draghi's ability to follow through on his promise.
The 3-year LTROs are passing almost unnoticed into monetary history. But the thing they helped create - Draghi's reputation - is now one of the most important factors in euro area markets.