Prof Philip Booth comments on the ECB's latest pledge
“In calling for there to be no default at any costs, the ECB is burying its head in the sand. By continuing to purchase low-grade government bonds from the private sector, the ECB is implicitly bailing out the private sector and may bankrupt itself. Indeed, the issue of sovereign default has become an important eurozone issue precisely because of this very policy of ECB purchase of poorly-rated sovereign debt. If it were not for the behaviour of the ECB, the sovereign debt crisis would be a much simpler issue that could be resolved between the nations themselves and their creditors.”
Notes to editors
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