Great point! Its clearly a measure to recapitalize EU banks. Part of the 3y LTRO will go into carry trades like you indicate. Another part will be used as a well needed safety net for short term debt maturities. I would also point out that banks are not likely to purchase bonds with maturities > 3 years. The game is up with the maturity of the LTROs running out. Banks are massively undercapitalized across Europe, and its a measure to address this specific challenge. Does it work? Nobody knows.
Great point! Its clearly a measure to recapitalize EU banks. Part of the 3y LTRO will go into carry trades like you indicate. Another part will be used as a well needed safety net for short term debt maturities. I would also point out that banks are not likely to purchase bonds with maturities > 3 years. The game is up with the maturity of the LTROs running out. Banks are massively undercapitalized across Europe, and its a measure to address this specific challenge. Does it work? Nobody knows.
TheFlowtex 1 month ago in playlist Uploaded videos
What you are saying seems to make sense. However something seems to be missing. Not sure what it is.
mokasuido 2 months ago