Monday, November 17, 2014

The double game of Mario: tame the markets and the Bundesbank – The Republic

The double game of Mario: tame the markets and the Bundesbank – The Republic

ROME – There’s an open game in recent months, played under the plaster, which helps to explain the actions of Mario Draghi. For some time now, faced with the opposition of the Bundesbank and the German government, the president of the ECB is currently performing the most complex: create and then manage the expectation that at a time close to the Eurotower really buy government bonds on the carpet.

Meanwhile, the European Court of Justice staged a plot thinner on the fate of the central bank. In August, the Community Courts in Luxembourg have indicated that they will decide in the first half of next year. On their table, it is time to query the German Constitutional Court. Prosecutors in Karlsruhe have concluded a year ago that, as far as they are concerned, the so-called “bazooka” of the ECB is illegal. The promise of Dragons who in 2012 put out the fire spreads – to buy government bonds, potentially indefinitely, in exchange for reforms led by the troika – the German court as it sounds unacceptable. Against it weighs an appeal of tens of thousands of citizens in Germany.

Karlsruhe but agreed to submit to the European Court and I expect the advice by June, possibly earlier. Likely to Luxembourg instead give the green light to the Dragons and the safety net that has since calmed market tensions. The challenge, however, would not end there.

FULL ARTICLE ON REPUBLIC OUT NOW AND REPUBLIC

Arguments:
market
Europe
Bundesbank
bce
Starring:
Mario Dragons

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