European leaders have dodged their "moment of truth".
Berlin, the Hague, or Vienna.
They know that Mr Macron is trying to bounce the North into fiscal union, exploiting the emotions of the pandemic to change Europe’s constitutional structure.
Such a jump violates treaty law. It breaches the German Basic Law and alienates the Bundestag’s tax-and-spend prerogatives.
It cannot legally be done with a flick of the political fingers.
The ECB will avert an immediate crisis by mopping up Italian debt under its "pandemic QE" plan. But it cannot keep doing this forever.
Private sellers are off-loading their bonds on the ECB and rotating the proceeds out of the country in what amounts to capital flight. These flows will surface in the ECB’s Target2 payments data.
The Bundesbank is in effect having to provide a forced "credit" to Club Med central banks that will soon blow through €1tn.
At some point this will become politically and legally untenable.
Ambrose Evans-Pritchard, Telegraph 24 april 2020
They know that Mr Macron is trying to bounce the North into fiscal union, exploiting the emotions of the pandemic to change Europe’s constitutional structure.
Such a jump violates treaty law. It breaches the German Basic Law and alienates the Bundestag’s tax-and-spend prerogatives.
It cannot legally be done with a flick of the political fingers.
The ECB will avert an immediate crisis by mopping up Italian debt under its "pandemic QE" plan. But it cannot keep doing this forever.
Private sellers are off-loading their bonds on the ECB and rotating the proceeds out of the country in what amounts to capital flight. These flows will surface in the ECB’s Target2 payments data.
The Bundesbank is in effect having to provide a forced "credit" to Club Med central banks that will soon blow through €1tn.
At some point this will become politically and legally untenable.
Ambrose Evans-Pritchard, Telegraph 24 april 2020
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