NEW YORK (TheStreet) -- The eurozone speaks softly to Russian President Vladimir Putin, but it carries a big stick in the form of the euro.
Europe now plans to deploy that stick by printing more euros.
European Central Bank President Mario Draghi is warning that the ECB will soon try to head off deflation with "further stimulus," more monetary easing aimed at cutting the euro's value relative to the dollar.
As a result, the euros that Putin is getting for his oil and gas will soon be worth less, and European governments will have more to spend on propping up the Ukraine. Or even buying renewable energy assets that will make that oil and gas worth even less.
But that's not why the bank is acting.
Europe faces the same problem America does and is coming to the same conclusions Ben Bernanke found to deal with it.
A little inflation is a good thing. There's something below a zero interest rate.
Technology causes deflation naturally. Products get cheaper and more capable all the time. That means a dollar or a euro goes further.
Deflation is good at Best Buy (BBY), but it's bad for an economy. As prices go down, commodity prices and wages fall faster. When prices rise slightly, on the other hand, people may get raises and there's more monetary oil in the financial engine. Thus, price stability today requires near-constant intervention in the market, pumping in new currency to make up for technology's deflationary effect.