Euro "crisis" (part 4): The ECB's self interest

In this fourth part of this little documentary series it is examined how the interest and the role of the ECB changed when it was decided that the ECB would buy Greek bonds.

Links:
- Link to the WSJ money printing in Ireland through ELA: http://online.wsj.com/article/SB10001424052748703818204576206680101497562.html
- Link to the FAZ-article (in German): http://www.faz.net/artikel/C30638/griechenland-warum-die-ezb-eine-umschuldung...

That the ECB owns these bonds, clearly influences the behavior of this institution. The focus of the ECB shifts from its actual core competencies to an involvement in the affairs of national governments.
Furthermore this video examines what would happen in the case of a Greek (Greece) default or restructuring ("reprofiling"). The ECB would maybe need new capital at the cost of (Germany's, Austrians and other's) taxpayers.
Worse: the situation could, and probably would evolve into an equivalent of money printing to keep the Greek banks and their banking sector solvent and prevent a complete collapse.
This would of course be a violation of every rule and treaty that actually should prevent the ECB from doing this. The Lisbon treaty, the Maastricht treaty, all promises would be broken, the reputation ruined.
Axel Weber seemingly saw this coming and resigned as president of the German Bundesbank months ago already.
Mr. Jean-Claude Trichet, the president of the ECB seems to become desperate and now proposes a EU/Euro-Finance ministry. This would then definitly mean that the euro-area is a federal state.
Do we want this?
And what would happen to the issuers of CDS - Credit Default Swaps?
The euro was a hughe mistake.
All this is of course in the context of the european sovereign debt crisis, euro crisis.

Category:

News & Politics

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[ukusapillage]

if the euro ends there will be uch crisis and extreme poverty specially in shouthern europe and it will send shock waves also germany alone will be totally sucked in by china they will buy each european country one by one, like they are doing in australia specially private companys, we will close the borders and the end of products coming from germany, gov will buy cheaper poducts from new alliances and geman companys will have the most expensive products in eu maybe the world bye bye germany

[BugMagnet]

A Euro finance ministry? That's bold face communism! This ministry would milk german tax payers dry in oder to even the social differences in europe and germany would thus lose withing months the rewards of two score years of hard work.

And it would tear up the EU as a whole. The Eurozone would be some sort of different country than the rest. What about GB or Poland? They wouldn't be part of this crucial part of EUSSR

[Annafin62]

The role of european financial ministers is really interesting. No wonder finnish finance minister tries to stay in position as long as possible.