In connection with the purchase of government bonds of highly indebted members of the
EMU by the ECB. – This is because the taxpayers of the efficient member states have to pay for the junk securities taken over in the course of the ECB’s fall from grace. This reduces their real income. – However, this reduction does not take place via the decision-making channels of the democratically constituted state (democratic decisionmaking), i.e. neither through resolutions of parliament nor on the basis of (by reason of) agreements between employers and employees. Rather, the Governing Council decides on this. However, the European Treaties have not granted the Governing Council any power of disposition over distribution policy in EMU. In this respect, the policy of buying up government bonds of EMU members that are unable or unwilling to pay is an illegal pretension on the part of the ECB and obviously an unlawful encroachment on the powers of the relevant bodies in the member states. – Furthermore, the ECB’s zero interest rate associated with the bailout leads to asset losses. Savers‘ money is devalued. They will also lose their orientation, because the interest rate has lost its signal effect (a factor that serves to transfer information and acts as a stimulus to action). According to all economic logic (as to indubitable economic reasoning), this will sooner or later lead to serious distortions in the financial market. – See exaggeration, central banking, buyouts, central banking, bail-out, balance sheet adjustment, deficit financing ban, European Monetary Union, fundamental error, money multiplication, monetary union-internal, moral hazard, credit assessment framework, bailout, shadow state, debt club, seven percent limit, sovereign debt reduction, Stability and Growth Pact, fundamental error, southern front, transfer union, wealth levy, contract compliance, debt stimulus.

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University Professor Dr. Gerhard Merk, Dipl.rer.pol., Dipl.rer.oec.
Professor Dr. Eckehard Krah, Dipl.rer.pol.
E-mail address: info@ekrah.com
https://de.wikipedia.org/wiki/Gerhard_Ernst_Merk
https://www.jung-stilling-gesellschaft.de/merk/
https://www.gerhardmerk.de/

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