To be effective, disclosures must give consumers information about credit pricing at a time when the information is relevant, in language they can easily understand. The information must also be in a format that allows consumers to pick out and use the information that is most important to them. Better credit disclosure facilitates better-informed credit decisions, and hence moreeffective competition among creditors.
Central bank purchases of government bonds make for a dangerous combination of monetary and fiscal policy. The central banks are becoming the euro-area countries’ biggest creditors. For a significant share of sovereign debt, government financing costs have become decoupled from capital market conditions.