We heard there was a protest outside the ECB yesterday, and we thought: is this related to interest rates? Buying bonds? Against some kind of coordinated action with the BOE?

It was nothing like that – it was a 90-minute strike by staffers, who formed an anti-Trichet drum circle:

European Central Bank workers staged a 90-minute strike today, the first in the bank’s history, to demand a greater say in how pay and pension entitlements are decided.

About 300 staff blew whistles, banged drums and waved placards of ECB President Jean-Claude Trichet saying “Lead By Example?” outside the bank before marching on downtown Frankfurt. “Trichet has failed with his internal policy,” said Adrian Petty, head of the International and European Public Services Organization. “He needs to change his attitude toward the staff.”

Apparently the last visible labor-relations incident outside the offices of their colleagues at the BOE was in 1912, when 150 printers picketed the joint after being dismissed. Of course, that is probably one of the positions that offers massive job security these days.

ECB did meet on interest rates today, and it turns out they are sticking with 1%, instead of heading down to BOE’s 0.5% “ZIRP-esque” levels. And they’re buying up bonds.

“The current rates are appropriate,” Trichet said at a press conference in Frankfurt. “For the remainder of the year economic activity will decline with much less negative rates.”

The 22-member Governing Council has been split over whether to follow the Federal Reserve and Bank of England, which have cut their key rates close to zero and are buying government and corporate bonds to tackle the worst recession in six decades. The debate over how far the ECB should go reached the highest level of European government this week, with German Chancellor Angela Merkel backing the Bundesbank’s view that asset purchases are a step too far.

Bundesbank President Axel Weber argues there is no real risk of deflation and buying assets to flood the economy with money is an unnecessary risk that could sow the seeds of future crises. Officials from smaller nations such as Slovenia’s Marko Kranjec and Cyprus’s Athanasios Orphanides are less certain and have indicated the ECB could buy a broader range of assets to fight the recession.

“Decline with much less negative rates” doesn’t necessarily radiate confidence, but it sounds better than “die in a fire,” which is really all we need these days to start inking bullish stories about economic recovery. I guess “Optimistic enough to stop cutting rates but not optimistic enough to stop injecting liquidity” is too long for a headline, as well.