Ivo Arnold, Professor of Monetary Economics at Erasmus School of Economics, has written an opinion piece on the European Central Bank's monetary policy.
In his opinion piece, also published in Nederlands Dagblad, Arnold criticises the ECB's attitude towards debt buybacks. The ECB is afraid that the interest rates between the euro countries will differ too much, which would make it disadvantageous for southern European countries to borrow money on the financial markets. Arnold emphasised that it is inherent in the currency union that interest rates differ between countries, because not every country is equally creditworthy.
Legitimate and necessary?
Arnold also questions the legitimacy of the ECB's policy. When the Maastricht Treaty was drawn up, the national parliaments of the Member States explicitly stated that they had no desire to have to bear the debt burden of other states. Also, the 'new' instrument that the ECB has created to continue buying up debt, the transmission protection instrument, seems superfluous. There are already existing, older instruments that can achieve exactly the same thing.