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Updated at 4.57pm
THE EUROPEAN CENTRAL bank today prepared financial markets for an imminent programme of sovereign bond purchases, with president Mario Draghi saying the bank had few other options at its disposal to counter the risk of deflation.
A day after ECB executive board member Benoit Coeure had said that the central bank’s governing council was in a position to announce such a programme at its first policy meeting of the year next week, Draghi upped the ante still further.
“All members of the ECB’s governing council are determined to fulfil our mandate,” he told the weekly newspaper Die Zeit, when asked about his plans to launch a controversial programme of large-scale buying of government bonds known as quantitative easing or “QE”.
The central bank’s mandate is to keep price inflation at just under 2%, but it fell to a negative 0.2% in December, raising fears that the eurozone could fall into a cycle of damaging deflation where falling prices lead to job losses and lower output.
“Of course there are differences about how we can do that. But it’s not as if we have an endless amount of possibilities,” he said.
The comments will fuel speculation that the ECB’s governing council will announce plans for a programme of some form of QE at its meeting on January 22.
Other central banks around the world have used QE programmes to kick-start their economies.
The Germans aren’t happy
But there are critics of such a programme in Europe, notably the Bundesbank or German central bank, which believes QE will take away the pressure on governments to reform their economies and is effectively a licence to print money to get them out of debt.
Under QE, central banks in effect create money to buy sovereign bonds, and thus government borrowing costs fall, but the objective is for the funds to find their way back into the economy through investment and spending.
Just yesterday, ECB executive board member Coeure had said discussions about a QE programme were “very far advanced”.
“We had a discussion last week on many of the technical details. We are definitely in a position to make a decision on January 22,” when the ECB’s policy-setting governing council meets next, Coeure said.
“But that does not mean we will actually make a decision,” he added.
Bond-buying gets the green light
A group of euro-sceptics in Germany actually took the ECB to court over an earlier bond-buying programme called Outright Monetary Transactions or OMTs, arguing that such a measure overstepped the central bank’s mandate.
Last February, Germany’s highest court, the Constitutional Court, voiced doubts about the OMT programme and sent the case to the European Court of Justice.
But the ECJ’s Advocate General Pedro Cruz Villalon found that Wednesday that the OMT programme is “in principle” in line with European treaties.
ECB executive board member Yves Mersch said Wednesday he “took note” of Villalon’s opinion and said the OMT programme was still “ready and available”.
“We have always been of the conviction that OMTs are legally sound and in line with our mandate,” Mersch told journalists.
“As in the past, the governing council will always comply with EU law. The end does not justify all means,” he added.
The OMT programme was unveiled in August 2012 at the height of the eurozone debt crisis when financial market turmoil looked set to bring down the single currency.
While it has never been put into use, its mere existence has proven to be the most effective weapon against the crisis and has largely defused fears of an imminent break-up of the eurozone.
Draghi has a tailwind
Analysts said the ECJ opinion will give added tailwind to Draghi and supporters of QE.
“QE is not controversial from a legal viewpoint. If anyone had any doubts on this issue they should be gone now,” said UniCredit analyst Andreas Rees.
Berenberg Bank economist Christian Schulz agreed.
“It means that no additional legal hurdles stand in the way of QE, for which we see a 90 percent chance to be announced at one of the next two meetings,” he said.
But Anshu Jain, one of the co-chief executives of Germany’s biggest bank Deutsche Bank, said that QE is not the cure-all that its proponents believe it is.
“Our people are fairly sceptical,” he said an interview on the N24 news channel.
“It will weaken the euro, which will help Europe, but it’s structural reforms that will really help,” Jain insisted.
Additional reporting Peter Bodkin
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If he cannot account for it then arrest him and question him on it. Its taxable and he didn’t pay tax on it. If it was you or I, we’d have had a knock on the door, handcuffed and carted off to the Bridewell at 6am answering to this. But it’s ok for Bertie.
Exactly. Someone will find conclusive proof if they keep digging. If nothing else, this man will be a pariah under suspicion, scrutiny and investigation for the rest of his life. Wouldn’t want to be in his shoes…
Too true!
It’s been a few years ago, but can anyone provide any info on Bertie Ahern’s tax clearance certificate? I seem to remember him reaching some sort of accomodation with the Revnue Commission in 2007 or 2008..? Would that accomodation cover this?
In mid-January 2008 it emerged in the press,[121] reportedly as leaks from parties to the Mahon tribunal, that Ahern will not be in a position to present a Tax Clearance Certificate to the Dáil, as is required under Ethics’ legislation. This certificate is issued by the Revenue Commissioners, to persons who have shown themselves to be tax compliant. It is a legal requirement that this certificate be presented to a Dáil committee by 31 January 2008 by those elected to the Dáil. In the absence of this, a certificate stating that Ahern is in negotiation with the Revenue Commissioners will suffice. An inability to declare tax compliance by a prominent individual, while highly embarrassing will suffice temporarily until Revenue either issue a tax compliance certificate or refuse it.
…
The Standards in Public Office Commission has been asked to investigate the Taoiseach’s declaration of tax compliance after the 2002 General Election.[123]
Ahern’s inability to furnish the tax clearance certificate has led to further calls for Ahern’s resignation. He is also the only member of the Oireachtas not to have a tax clearance certificate[115] On 14 January 2008 while on a visit to South Africa, Ahern accused Enda Kenny, leader of the opposition of telling[124] a “bare-faced lie” about Ahern’s tax situation. Ahern and Fianna Fáil’s response has not addressed the issue, but has attacked the leaking of Ahern’s tax affairs so as to attempt to enable the non-compliance issue to be ignored. Labour party leader “Mr Gilmore joined the offensive over the weekend, saying the Taoiseach was now providing at least four different versions of his personal finances and was unable to get a tax clearance certificate.”[125] As of 2010 Ahern has still not been able to provide a tax clearance certificate.[citation needed]
Ahern admitted to the Mahon Tribunal on 21 February 2008, for the first time, that he did not pay tax on substantial payments that he received when Minister for Finance in the 1990s.[126] Wikipedia…
Did anyone expect any different? The tribunal “stopped short of making any findings of corruption” thereby leaving it pointless to refer the matter to the DPP. Politicians & the legal profession.. The whole lot stink.
Nothing to stop the minister of justice forwarding the report to the DPP and Garda and asking them to investigate. Bertie might get his collar felt at some stage.
Already confirmed in the Dáil that the Mahon report is gonna be referred to the DPP…
WOW! Really? Never would of thought that.
Bertie is a dirty rotten liar a scumbag and a deceitful b****d ,who has done nothing for this country except bring it to it’s knees !!! Shame on him , but this been ireland the land were criminals and corrupt politicians rule so therefore the pig will never do time !! Unlike the ordinary decent person who can’t pay television licence or parking fines etc
…..or their household charge !……..
We, as a nation should avoid any tax possible, until that crook gets stripped of his pension and any other benefit he has reaped through his years destroying our tax system and feathering his own nest. They won’t criminalise their own or strip their own without being forced to.
Already have. Ray Burke, Frank Dunlop, George Redmond, Liam Lawlor. There’ll be more. A large number of FF, FG and other county councillors have also been found to have solicited payments…
A politician might have told a lie i’m shocked and amazed.Thought our politicians were the best money could buy.
Judging from some of the tribunals finding some were indeed “the best money could buy”
They were well bought and we were sold out …. I can not believe that I am sitting at my laptop, instead of going to Berties and asking him up close what he intends to do to make amends ……… THe Gardai there protecting him, do not deserve for me to upset their day . I will leave Bertie to the law , I will leave him to rot .
Lock the b*****d up right now
Have to ask you Jimbo what for? BTW i dislike the p***k aswell.
Lock the monster up…. Funny I might go to jail for not paying the 100 euro household charge…
So Bertie will not go to jail for something he did and I could be in jail because of the awful legacy he has created…. Is this Fair???
So it’s official: Bertie is a scumbag. Now hope that reputable institutions like Queens are prompted to remove the honorary degree they awarded him. After all doesn’t he have an imaginary LSE qualification to fall back on?
execute him for treason.
So when does he go to prison?
Ah go easy on auld Bertie. Sure wasn’t he the one who personally masterminded the successful economy of the Tiger years so as we could all go on 11 foreign holidays a year and move into bigger houses and buy 4×4′s to pull our horse boxes. He deserves every penny he got. Bless ..
He’s been vindicated this morning. Lovely fella altogether ;p)
I’m assuming that because the tribunal didn’t believe Bertie’s evidence, they won’t be paying his legal fees! I can’t see how the taxpayer can be expected to pay, when an individual tells barefaced lies!!
well if the tax payers pay this scroat’s legal fees , ………………….
I voted for this man & it makes me feel foolish & niave. How can this country move forward now. We cant trust our politicians our legislators our leaders. If prosecutions dont follow the political system is doomed in this country. I think FF may now never come from this & maybe as a political gesture to restore some integrity in the political system should cease. I know that is unrealistic but our politicians do not realise we are reeling from this & its going to take years to trust again. Bertie I trusted you to represent me & you didnt. You are a failure.
Glad to see you have actually woke up
Michael J .
Thanks for your honesty , don’t be so hard on your self ,you were not the only one who voted for him. Keep your eyes open now tho ! Follow your own beliefs, .
What a COMPLETE WASTE of TIME & more importantly money, MY money – OUR money.
€300m or so for this ‘tribunal’ and no one will face justice yet us mere mortals will be followed to the ends of the earth for the household charge that has a total possible income of €160m?
YEAH, great fucking country.
And how much have Revenue, CAB, etc recovered from those exposed by the tribunals? How would you feel if it turned a profit?
I’ll wait until its recovered €300,000,001 first.
Good man. Democracy for a quid…
LOL…. As always…. Does it matter? Nothing will be done!
Reading this from the other side of the world, I can smell it here, it stinks to high hell.
So what are the recommendations from the tribunal?
Are there any outcomes or measures that can be put in place to ensure that it can never happen again, isn’t that one of the reasons why a tribunal is held, find who is responsible/guillty and learn from it??
You couldn’t have picked a more fitting photo of our former leader – loving your work!
As for the rest…..well hardly surprising is it!
Bertie learnt from the best didn’t he? C Haughey has a lot to answer for, allowing a corrupt culture such as this to be embedded into government, accepted and allowed to fester all the way to the top.
This is the 165,000 they could locate, what about the rest, didn’t stop at this amount surely?
http://www.youtube.com/watch?v=62bPIXhXfmY&feature=player_embedded
Michael Martin defending Bertie and his horsey winnings. This man is completely devoid of shame and his moral compass is completely defunct. No wonder he was made FF leader.
If there is even an decent ounce in you Micheal, you will resign and expel Ahern, Burke and the rest of them from the party. Is there even the smallest bit of you that has a concern for this country.
M.Martin should expel all named from party then disband this party and the Berties and Burkes should All Face Criminal Charges and Flynns from Mayo should have the farm seized and their Big state Ministerial Pensions stopped.. If we lock them up it will cost us to keep them Let them claim the pension that all retiree’s have live on or let them try and get a normal job if anyone would employ them or just tell them all to Fcku off out of Ireland
one good think, gift grub are going to have a field day wit this.
Well we can either get cross or depressed or smart about it
Perjury, yes
Imagine if he was our president no wonder he is so well liked in Nigeria
if this was a normal person and they couldn’t account for that money, they would be arrested and it would be taken off them by the criminal assets bureau
When are the findings from “dog bites man” tribunal going to be published?
Typical Irish tribunal it “stopped short ” when it needed to get answers,tribunals are like races its not how you start its how you finish and on this case the race stopped ages ago,Ahern like lawlor and flynn are scum
Lock him up like you would any other Joe Soap who did the same and lied. This man (and his ilk) personifies everything rotten in this country.
Should have got his cheques made out to CASH.
Bertie Ahern may have received 165k from Al Qaeda. Can he prove he didn’t? (try opening a bank account with cash these days)
At least Bertie only took money from some one who wanted to give it to him. He didnt rob you and me like the fkrs in the Mahon tribunal.
have your say