European Court Of Justice Deferred Again To Big Government

Posted: 12/11/2018

For lack of time, I will not go into details here, but refer the reader to e.g. Source 1 and to do some research. The facts of this case have been well covered in the media for a number of years.

On December 11, 2018, the European Court of Justice decided it was OK for the European Central Bank to purchase Euro trillions of various government bonds over several years. Unfortunately, the Federal Reserve central bank also engaged in similar purchases.

This is just another example how the highest possible court (in this case the European Court of Justice) in a legal dispute about government policies rubber stamps government policies.

Clearly, this massive purchase program of government bonds is a form of government financing, which obviously contravenes the no bail out clause in European agreements about the single currency.

One can also safely assume that these justices have very limited understanding of economics.

Sources:

1. The ECB’s PSPP programme for the purchase of government bonds on secondary markets does not infringe EU law. It does not exceed the ECB’s mandate and does not contravene the prohibition of monetary financing (official press release; 12/11/2018)
2. EUGH-URTEIL : EZB-Anleihenkäufe sind rechtens (12/11/2018)