Saturday, September 03, 2011

A TOURNIQUET is just an emergency measure, but it doesn't really cure an injury:

The ECB's purchases treat a symptom of the euro-zone crisis, not the cause. They can't address investors' concerns about the ability of governments to rein in budget deficits and start to bring debt burdens down. In fact, the ECB's purchases allow risk-averse investors to sell out of Italian and Spanish government bonds and buy safer debt such as German bunds.