Europe’s debt crisis has reached it’s limit. As many countries in
Europe have been living off of debt for some time now, but the European
Central Bank is now doing something to try to bail them out. Some of
the countries may not qualify being there are strict policy conditions
that have to be met and the countries have to be active in the debt
market. Ireland is predicted to receive a great amount of benefit from
this bailout, as it is presumed to rid all the risk of the euro zone
break-up, but wanted to be sure that they weren’t announcing any
purchasing of the Irish bonds. The European Central Bank was very
confident in their decision stating “Anybody who had any doubts that the
ECB was prepare to bring the tools needed any doubts must be removed
now,” Patrick Honohan, leader of Irelands central bank stated. While
the ECB was ready to get the press running and help, there was also lots
of criticism on the ways of how it was being handled. Some were
stating that it was going to put the entire currency at risk because it
was ready to write unlimited amounts of bonds to bail out the troubled
euro zone states. ECB President Mario Draghi said they were going to
extreme highs for the bailout request, and that they were even willing
to buy unlimited amounts of bonds of up to three-year maturities, but
only under strict conditions. Honohan was assuring that this unlimited
plan would be of much more help then the previous temporary
bond-buying. Dublin has already sold new long-term debt in preparation
for the 2013 85 billion euro bailout, the first time selling long-term
debt since 2010. While this may seem drastic the President was
reassuring that the bank wasn’t rushing to warm up the printing press,
that this was a well thought out plan and it’s purpose was to make the
euro and it’s system strong again.
http://www.brecorder.com/business-a-finance/banking-a-finance/77798-ecbs-honohan-says-bond-plan-will-silence-doubters-.html
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