Monday, September 3, 2012

How will ECB Meeting September 6 2012

How will ECB Meeting September 6 2012, proposals ECB President Mario Draghi announces on Sept. 6 ; The key date is Sept. 6, when the European Central Bank meets. There's widespread expectation that the ECB will purchase sovereign debt. What I hear is that they'll make an example of Portugal and drive their interest rates down. They'll flex their muscles in the bond market and convince the world that they have the ability to control the situation. They can't fix the countries. The question is: Can they fix the financial turmoil that bubbles up now and then? My guess is that they'll succeed because they can't afford to fail. That could really help the markets.

many think that Mario Draghi, the head of the European Central Bank, is going to unveil a big bond-buying program, too. It's not a done deal yet, a lot of work still has to be done to make it happen. The German Constitutional Court ruling Sept. 12 on whether or not Germany can participate in Europe's rescue fund is huge, too. They're all important, but I think they're going to go the way the market expects.

Europe are the biggest events as far as we're concerned. They're the most dangerous risk. If you're expecting the ECB to announce that they'll start supporting the region's bond markets on Sept. 6, you're going to be disappointed. It's more likely that they wait for the German Constitutional Court ruling one week later and also wait for Spain to formally ask for help. The next three weeks are really crucial.

German Finance Minister Wolfgang Schaeuble warned against placing too much faith in the European Central Bank’s bond-buying plans as pressure grows on Spain and Italy to decide whether to seek assistance to lower borrowing costs.

Whatever proposals ECB President Mario Draghi announces on Sept. 6 must fall within the Frankfurt-based central bank’s mandate, Schaeuble said in an interview today on Deutschlandfunk radio. Germany won’t accept ECB financing of state budgets, he said.

We have to be very careful that we don’t raise false expectations,” Schaeuble told the broadcaster in Berlin. “It has to remain very clear, state debt can’t be financed through monetary policy. Therefore we can’t have a decision -- we would think it very wrong -- that’s not covered by the ECB mandate.”

European leaders are awaiting the details of the ECB’s plan and a German high-court decision next week that will determine whether policy makers have the bailout funding required to tackle the euro crisis almost three years after it emerged in Greece. The stakes for those countries at the heart of the contagion were underscored last week when Spain’s government said it will inject emergency funding into Bankia group, its third-largest lender, which posted a first-half loss.

Here is a rundown of what analysts and economists at some large banks believe the ECB is set to do next September 6 2012 Read Analysts Predictions ECB Meeting sept 6 2012

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