Penalty interest and helicopter money German rehearse uprising against ECB

With penalty interest the ECB fights allegedly against deflation, even threatens the helicopter money. But there is no threat of deflation, saying Germany’s economy. Now think bankers and politicians of all trenches over how the fatal Gespensterjagd can be terminated. Targeted financial help to businesses and consumers directly from the central bank – bypassing the normal banking sector? ECB President Mario Draghi called the concept of helicopter money as a “very interesting”. The Council of the central bank have discussed such ideas not yet accurate, Draghi presented simultaneously clear.

But in Germany already makes the mere mind game for horror. “In science you can think anything, since there is no taboo. But this debate has indeed reached the public space. I think this is a total mental confusion “, criticized the former chief economist of the European Central Bank (ECB), Otmar Issing. “Bankrupt of monetary policy” “The whole idea of ​​the helicopter money I think is worrying for downright devastating. For this is nothing more than a declaration of bankruptcy of the monetary policy, “said Issing on. “A central bank, has presented the money will hardly be able to regain control of the printing press.” Even Germany’s economy will see the development with concern – and warn strongly: “The loose monetary policy can have significant side effects,” said Isabel Schnabel, Member of the Advisory Council, last week in Frankfurt.

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Draghi and his people would put the profitability of the banks under increasing pressure and also reduce the pressure for reform in Europe, so its beak on. “The ECB has responded much more strongly than in the past, that’s justification worthy” added beak colleague Volker Wieland. Even the rather left economy Peter Bofinger considers the recent easing of “no longer necessary”. He had defended the loose monetary policy last. But now there is a risk that the ECB shall overlay.

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Even Wolfgang Schäuble sees itself now forced to mingle in the debate – and he also criticizes the ECB. Your monetary policy stelle “banking supervision and financial regulation completely new challenges,” warned the CDU politician, though he actually holds back with advice to the ECB. He was eventually “well behaved”, stressed the Minister of Finance this week. FDP leader Christian Lindner called on the government on the other hand, Draghi to rein in. “I agree with the critical position of Bundesbank President Weidmann. Him should the federal government aggressively strengthen the back, “Lindner told the” Welt am Sonntag “(” WamS “).

Weidmann had the mind games Draghi criticized harshly. “Whether and how money is given away to citizens, is a highly political decision, would make governments and parliaments,” he said. The ECB had to a mandate, not least because this would entail a massive redistribution. “That would be nothing but the complete mixing of monetary policy and fiscal policy and the central bank independence incompatible “criticized Weidmann. That German bankers and politicians appear suddenly unfamiliar agree something is saying. The strange thing is the way that the risk of deflation – does not exist, according to economic experts – thus a spiral of falling prices that can choke off the economy. So what is the real reason for the rate of the ECB?
National interests dominate the ECB

“The problem is that national considerations play a role, where they should play no role,” Issing told the “world”. The moment in which the ECB will decide which country they buy as many government bonds, monetary policy will politicized, so Issing on. Only when the ECB to return to a conventional monetary policy, the problem was defused. However’d already made mistakes in the personnel policy: Governments would appoint such people in leadership positions, “of which they expect good behavior,” said Issing’s successor as chief economist of the ECB, Jürgen Stark, the newspaper. “But just as you would have stringent and uncompromising to be,” says Stark. But how could that be possible? The outgoing Ifo President Hans-Werner Sinn is intended as Lindner to the federal government: “Since the protests of the Bundesbank does not help, Germany should require a change in the Maastricht Treaty.”

Specifically encourages sense that Berlin’s commitment to a change in the voting rules in the Governing Council. There Germany has only one vote – as each euro member. Because a rotation principle applies since 2015 the Federal Reserve Chairman must back and even suspend completely again. “It can not be that Germany has so much to say as the largest economy in the euro zone as Malta” criticizes sense.
“If there are no independent experts” Support receives sense of economic policymakers of the Union and the SPD. “We must learn from the euro crisis the conclusion that there is just no independent experts who sit in the Governing Council. Then you have to respond with new decision rules about different voting weights, “citing the” world “the head of the CDU Mittelstandsvereinigung, Carsten Linnemann.

“The largest economy in the euro area, which is also the lifeline of the common currency with their credit needs, to participate in accordance with its economic weight in all the votes,” thus says Wolfgang Steiger, general secretary of the CDU Economic Council. The “old, established procedures” is no longer employable. “Wrong, now to change the mandate of the ECB” In the SPD to adopt more cautious, however, agrees in principle. In the present situation, it does not make sense to negotiate new voting rules, said SPD budget expert Johannes Kahrs the “world”. However, things are different, “when the institutions and players concerned are relaxed and not be in the middle of crisis management”.

However, opposition comes precisely from Germany’s economic ways. It would be “wrong, at this stage the ECB’s mandate to change”, Isabel Schnabel said the “world”. Because that would damage the credibility of the ECB. A change of voting “for example, by a shift in voting weights”, they think anyway “not effective” for Schnabel further and Issing dismisses. “even if Mr. Weidmann had the triple voting rights, would change little,” he says. “Helicopter money would mean a break with the system” Michael Heise, chief economist of Allianz, sees only action if the ECB exceeds its mandate. but when using helicopters money that was indeed the case, because that “would mean a break with the system,” Heise said the “world”. “Then it would be legitimate and urgent that politics exerts pressure.”