The European Central Bank is poised to buy up billions securities. Ifo chief Hans-Werner Sinn is calling on the federal government and the citizens, to stop the project. Because the plans of the Central Bank are highly risky.
Before the Council meeting of the European Central Bank (ECB) on Thursday, the criticism of the anti-crisis rate of the monetary authorities louder in Germany. So Sparkassen-President Georg driving Already renewed his reservations about the loose monetary policy in the euro zone. Ifo chief Hans-Werner Sinn called on the Federal Government to tackle the controversial purchase of loan packages (Asset Backed Securities / ABS) by the ECB.
In a commentary for the “Business Week” writes sense that the government is committed to such action: “they do not do it, they can force every citizen in the Constitutional Court to do so.” According to sense the ECB exceeds the purchase of such securities its monetary policy mandate. The Constitutional Court of the coalition expressly prohibited in February to stand idly, let alone endorse mandate overruns, writes sense. “With the ABS purchases the foreseeable depreciation of bank losses are socialized – and there are risks of many hundreds of billions of euros transferred from the creditors of these banks to the taxpayer in the Euro-zone.”
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Governing Council meets on Thursday together
European monetary authorities had last monetary policy because of weak growth and low inflation further relaxed. In October, the controversial purchase of loan packages (ABS) is to begin to relieve banks. About the program, the Governing Council deliberates on Thursday (02.10.) In its external meeting in Naples.
Savings Bank Chairman driving Already reiterated his criticism: “The European Central Bank is at the end of its tether,” the president of the German Savings Banks and Giro Association of the “Berliner Zeitung” said (Saturday). To be fair, we must say but: “This is partly because the governments of the euro zone have brought them in this difficult situation, piece by piece, the ECB becomes a kind of European replacement government, however, is not their job…”
“Now the country must do the work yourself”
He expects the ECB a “clear signal to the Member States”, that they could no longer trust that the monetary policy Do the homework for them. “Now the country must do the work themselves, with reforms and investments”, so driving at.
Europe is also too little prepared Drive Schons, according to the results of the ongoing bank stress tests. “Europe puts down a wild ride.” In his view, quality must go before speed. “Instead, it goes to the motto eyes and through,” said the savings bank president. For the financial markets and the feedbacks were but too complex
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