Robert Holzmann statement:
According to Holzmann, the ECB must cease supporting banks. April 3, Vienna (Chinese times): Governor Robert Holzmann of the Austrian central bank stated that the European Central Bank should cease furnishing subsidies to marketable banks and should reduce interest payments on the large quantities of cash lenders attained from the central bank.
The European Central Bank( ECB) and other public central banks in the euro zone are deeply in the red as a result of marketable banks holding redundant liquidity valued at 3.2 trillion euros and parking it at the ECB at a rate of 4. Holzmann, a member of the ECB’s 26-member Governing Council, stated,” There is no financial policy reason why we should offer this subvention.” In an interview, Holzmann stated,” It’s not respectable that the current structure puts a major burden on the fiscal issues of central banks.” “We cannot run poverty without an end in sight; that can’t be the case.”
The core problem is with the European Central Bank’s massive plutocrat publishing program, generally referred to as quantitative easing, which illustrated the bank’s encouragement enterprise throughout the past ten years. Trillions of euros were produced by the ECB in order to buy government bonds, with the anticipation that easy access to credit would spark profitable expansion and raise inflation to 2. The European Central Bank( ECB) incurred minimum costs while interest rates were negative, but presently, it’s needed to pay a 4 interest rate on the plutocrat it gave lenders, which far surpasses any profit.
The payments will presumably continue to be a long-term burden because it’ll take time for the bond pile to drop, and some central banks may use up all of their profit reserves. The European Central Bank( ECB) decided last time to accreditation banks to hold 1 percent of fat reserves with the central bank without compensation, in part as a response. Indeed, though the German central bank had a net interest income of negative 13.9 billion euros in 2023, several policymakers, especially Bundesbank President Joachim Nagel, campaigned for an advanced rate but were unfit to win support. Holzmann declared that he wanted to stop making bank payments and that he wasn’t ready to give up this battle. He stated,” For me, the discussion is clearly not settled,” and suggested that unremunerated reserves ought to range from 5 to 10. Holzmann remarked,” For me, it’s a clawback.
