Welcome to European Tribune. It's gone a bit quiet around here these days, but it's still going.
Display:
The key point seems to be:

Insolvency for central banks therefore would mean failure to pay obligations as they fall due (equitable insolvency) rather than liabilities exceeding assets (balance sheet insolvency).

As long as central banks don't have significant foreign exchange-denominated liabilities or index-linked liabilities, it will always be possible for the central bank to ensure its solvency though monetary issuance (seigniorage).

...which the ECB won't do, leaving recapitalisation by the Treasuries of the 15 Eurozone governments, which is tricky. Did I miss something?


*Lunatic*, n.
One whose delusions are out of fashion.

by DoDo on Thu Jun 16th, 2011 at 05:54:15 AM EST
[ Parent ]

Others have rated this comment as follows:

Migeru 4

Display:

Top Diaries

Impeachment gets real

by ARGeezer - Jan 17
19 comments

A Final Warning

by Oui - Jan 10
111 comments

Environment Anarchists

by Oui - Jan 13
4 comments

More Spanish repression

by IdiotSavant - Jan 6
8 comments

Occasional Series