IDEAS home Printed from https://ideas.repec.org/p/pra/mprapa/69235.html
   My bibliography  Save this paper

Eurosystem debts do matter

Author

Listed:
  • Whittaker, John

Abstract

Since September 2015, the European Central Bank has been publishing Target2 balances of the eurozone national central banks. But this presents an incomplete picture of intra-eurosystem debts because it does not include those arising from the issue of banknotes. The ECB also plays down the importance of Target2 debts as a “normal feature of the decentralised implementation of monetary policy in the euro area”. But if Greece were to leave the euro and its eurosystem debt (currently €114bn) were written off, other eurozone countries would bear the loss, in addition to losses on official loans. There is no effective mechanism for limiting eurosystem debts. And exit risk – the risk that Greece or some other eurozone country with large eurosystem debts will leave the euro – will always be present.

Suggested Citation

  • Whittaker, John, 2016. "Eurosystem debts do matter," MPRA Paper 69235, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:69235
    as

    Download full text from publisher

    File URL: https://mpra.ub.uni-muenchen.de/69235/1/MPRA_paper_69235.pdf
    File Function: original version
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Sinn, Hans-Werner, 2017. "The Euro Trap: On Bursting Bubbles, Budgets, and Beliefs," OUP Catalogue, Oxford University Press, number 9780198791447, Decembrie.
    2. Whittaker, John, 2011. "Eurosystem debts, Greece, and the role of banknotes," MPRA Paper 38406, University Library of Munich, Germany.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Whittaker, John, 2020. "Financial support for Italy will be costless," MPRA Paper 101025, University Library of Munich, Germany.
    2. Sergio Cesaratto, 2017. "The Nature of the Eurocrisis. A Reply to Febrero, Uxò and Bermejo," a/ Working Papers Series 1703, Italian Association for the Study of Economic Asymmetries, Rome (Italy).
    3. Chmielewski Tomasz & Sławiński Andrzej, 2019. "Lessons from TARGET2 imbalances: The case for the ECB being a lender of last resort," Economics and Business Review, Sciendo, vol. 5(2), pages 48-63, June.
    4. David Blake, 2023. "Target2: The Silent Bailout System That Keeps the Euro Afloat," JRFM, MDPI, vol. 16(12), pages 1-126, December.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Sinn Hans-Werner, 2019. "Der Streit um die Targetsalden : Kommentar zu Martin Hellwigs Artikel „Target-Falle oder Empörungsfalle?“," Perspektiven der Wirtschaftspolitik, De Gruyter, vol. 20(3), pages 170-217, September.
    2. David Blake, 2023. "Target2: The Silent Bailout System That Keeps the Euro Afloat," JRFM, MDPI, vol. 16(12), pages 1-126, December.
    3. Bindseil, Ulrich & Corsi, Marco & Sahel, Benjamin & Visser, Ad, 2017. "The Eurosystem collateral framework explained," Occasional Paper Series 189, European Central Bank.
    4. Paqué Karl-Heinz, 2015. "Die Rückkehr der Ideologien," Perspektiven der Wirtschaftspolitik, De Gruyter, vol. 16(3), pages 302-321, October.
    5. Bindseil, Ulrich, 2021. "Lessons from early central banking for today," IBF Paper Series 01-21, IBF – Institut für Bank- und Finanzgeschichte / Institute for Banking and Financial History, Frankfurt am Main.
    6. Nataliia Kostiuchenko, 2015. "A Challenge Of Trust: Can Distrust Kill The Euro?," Baltic Journal of Economic Studies, Publishing house "Baltija Publishing", vol. 1(1).
    7. Giovanni Dosi & Marcello Minenna & Andrea Roventini & Roberto Violi, 2021. "Making the Eurozone work: a risk-sharing reform of the European Stability Mechanism," Annals of Operations Research, Springer, vol. 299(1), pages 617-657, April.
    8. Georg Dettmann, 2014. "Determinants of Internal and External Imbalances within the Euro Area," Working Papers 01/2014, University of Verona, Department of Economics.
    9. Christian Thimann, 2015. "The Microeconomic Dimensions of the Eurozone Crisis and Why European Politics Cannot Solve Them," Journal of Economic Perspectives, American Economic Association, vol. 29(3), pages 141-164, Summer.
    10. Joshua Aizenman & Gunnar Gunnarsson, 2015. "Fiscal Challenges in Multilayered Unions: An Overview and Case Study," Social Sciences, MDPI, vol. 4(2), pages 1-20, May.
    11. Armin Steinbach, 2015. "The Mutualisation of Sovereign Debt: Comparing the American Past and the European Present," Discussion Paper Series of the Max Planck Institute for Research on Collective Goods 2015_02, Max Planck Institute for Research on Collective Goods.
    12. Höpner, Martin & Seeliger, Martin, 2017. "Transnationale Lohnkoordination zur Stabilisierung des Euro? Gab es nicht, gibt es nicht, wird es nicht geben," MPIfG Discussion Paper 17/13, Max Planck Institute for the Study of Societies.
    13. repec:ces:ifodic:v:13:y:2015:i:1:p:19158700 is not listed on IDEAS
    14. Clemens Fuest & Hans-Werner Sinn, 2018. "Target Risks without Euro Exits," CESifo Forum, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, vol. 19(04), pages 36-45, December.
    15. Ferrara, Federico M. & Masciandaro, Donato & Moschella, Manuela & Romelli, Davide, 2022. "Political voice on monetary policy: Evidence from the parliamentary hearings of the European Central Bank," European Journal of Political Economy, Elsevier, vol. 74(C).
    16. Witold Małecki, 2018. "Nowe uwarunkowania polityczne i ekonomiczne przystąpienia przez Polskę do strefy euro," Gospodarka Narodowa. The Polish Journal of Economics, Warsaw School of Economics, issue 2, pages 29-47.
    17. Wolfgang Nierhaus & Timo Wollmershäuser, 2016. "ifo Konjunkturumfragen und Konjunkturanalyse: Band II," ifo Forschungsberichte, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, number 72.
    18. Kleczka, Mitja, 2015. "Monetary Policy, Fiscal Policy, and Secular Stagnation at the Zero Lower Bound. A View on the Eurozone," MPRA Paper 67228, University Library of Munich, Germany.
    19. Sergio Cesaratto, 2017. "The Nature of the Eurocrisis. A Reply to Febrero, Uxò and Bermejo," a/ Working Papers Series 1703, Italian Association for the Study of Economic Asymmetries, Rome (Italy).
    20. Höpner, Martin & Spielau, Alexander, 2015. "Diskretionäre Wechselkursregime: Erfahrungen aus dem Europäischen Währungssystem, 1979-1998," MPIfG Discussion Paper 15/11, Max Planck Institute for the Study of Societies.
    21. Matthias Brendel & Jakob Eberl & Christopher Weber, 2015. "Risky Risk control," ifo Schnelldienst, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, vol. 68(14), pages 41-49, July.

    More about this item

    Keywords

    Target2; eurosystem; monetary union; euro banknotes;
    All these keywords.

    JEL classification:

    • E42 - Macroeconomics and Monetary Economics - - Money and Interest Rates - - - Monetary Sytsems; Standards; Regimes; Government and the Monetary System
    • E52 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Monetary Policy
    • E58 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Central Banks and Their Policies
    • F33 - International Economics - - International Finance - - - International Monetary Arrangements and Institutions

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:pra:mprapa:69235. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Joachim Winter (email available below). General contact details of provider: https://edirc.repec.org/data/vfmunde.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.