Yesterday the Eurosystem agreed on 10 recommendations sent to national Governments covering pricing modalities, timing, eligibility criteria, etc.. At a cross-border level, as no EU agreement exists on the financing of insolvent institutions, home country authorities may be reluctant to spend resources that will benefit host countries, or will be faced with situations in which they will not be able to save financial institutions because they are “too big to save”.
He suggests using free ESM funds to finance investments in infrastructure. In my view, such a step would greatly reduce the effectiveness of the ESM. In a way, the discussion about liability and control relates to monetary policy. The Governing Council of the ECB recently decided to buy asset-backed securities.