The plan does not like Dragons in Berlin: we are opposed to the purchase of … – Il Sole 24 Ore

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This article was published on 25 September 2014 at 11:55.
The last change is the 25 September 2014 at 24:29.

The German government is contrary to the plan for the purchase of asset-backed securities proposed by the ECB. The ‘trip’ to the address of Mario Draghi is playing a leading figure of the establishment German Finance Minister Wolfgang Schaeuble: “I’m not particularly happy with the purchase of securitized assets by the ECB,” said Schaeuble during a speech to the Bundestag, because it could create conflicts of interest between the activities of the institution, which in November will also assume the role of supervisors, central banks in Europe. According to Schaeuble must act “with caution” even “to avoid conflicts of interest or appearances of conflicts of interest” between monetary policy and supervision, which must be “strictly separated” within the ECB.

On Thursday, the new plan Abs
stance, the first of a prominent figure close to Angela Merkel arrives in a few days by the expectation press conference Draghi, on Thursday next after the meeting of the board in Naples announce the details of the plan for the purchase of securities of Abs. The idea is to buy asset-backed securities issued by banks’ financial vehicles backed by mortgages or business loans. The goal is to free up bank balance sheets in this way to revive the credit with $ 350 billion of new purchases. In all, four-year lending rate between almost zero (the Tltro) and purchases of Abs, the ECB expects to increase its budget by 2 thousand to 3 thousand billion euro.

The target is “Qe”
real target Schaeuble actually could be quantitative easing, the massive program to purchase government bonds that the ECB could launch in the coming months if the threat of deflation were to materialize. Both the Bundesbank President Jens Weidmann, the German Government have never hidden their opposition to the project, which would constitute a financing of national budgets and therefore would violate the mandate of the ECB. Draghi instead has never ruled out the possibility of appeal to the ‘Qe’ if the situation may require. At the last meeting of the board, when the ECB has cut the cost of borrowing to 0.05% and announced the plan for the purchase of Abs, Weidmann voted against.

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