http://noir.bloomberg.com/apps/news?pid=newsarchive&sid=aOfFjGe5i8tk
While German and French officials say the ECB would no longer accept Greek debt as collateral in its money-market operations should the country be forced to default, the ECB’s rules are less clear and only say that such a step “may be warranted” if officials deem it necessary. The ECB’s rhetoric may be as much about forcing Greece to step up budget cuts as it is about drawing a line in the sand, say Citigroup Inc. and Deutsche Bank AG economists.
Citigroup estimates that about a third of the county’s debt, or 109 billion euros, is held by so-called foreign non-banks including mutual, pension or sovereign-wealth funds as well as insurers. Greek financial institutions own about 29 percent.
“If you write those down by half, you wipe out the entire capital stock of the Greek banking system,” said Klaus Baader, an economist at Societe Generale in London. “Complete havoc would be wreaked with the ECB’s ability to conduct monetary policy.”
While German and French officials say the ECB would no longer accept Greek debt as collateral in its money-market operations should the country be forced to default, the ECB’s rules are less clear and only say that such a step “may be warranted” if officials deem it necessary. The ECB’s rhetoric may be as much about forcing Greece to step up budget cuts as it is about drawing a line in the sand, say Citigroup Inc. and Deutsche Bank AG economists.
Citigroup estimates that about a third of the county’s debt, or 109 billion euros, is held by so-called foreign non-banks including mutual, pension or sovereign-wealth funds as well as insurers. Greek financial institutions own about 29 percent.
“If you write those down by half, you wipe out the entire capital stock of the Greek banking system,” said Klaus Baader, an economist at Societe Generale in London. “Complete havoc would be wreaked with the ECB’s ability to conduct monetary policy.”
No comments:
Post a Comment