Another German contender for ECB President has bowed out of the race. First it was Axel Weber, long thought to be the frontrunner. Now German ex-minister Steinbrueck rules out taking ECB job.
Ex-finance minister Peer Steinbrueck said he was not interested in the role as he shared the same views as outgoing Bundesbank President Axel Weber.
Both men oppose the ECB policy of buying government bonds from countries with high debt levels. Mr Steinbrueck said he would have had a “minority” view at the Bank.
“I am not available for this job,” he told Sueddeutsche Zeitung.
The ECB has been buying risky government bonds if international investors have either shied away from buying government debt, or demanded too high a rate for it.
The bank bought Portuguese government bonds last week after yields rose to record highs in early trading, sparking renewed fears about Portugal’s ability to raise money on the international markets.
Yields fell quickly after the ECB’s intervention.
We don’t want no transfer union
Please consider The Economist article We don’t want no transfer union
German behaviour is guided by more than petty politics. In adopting the euro the Germans thought they were joining a condominium, in which every member would keep order on their own property, and not a messy commune. Now the crisis threatens that understanding. The Greek bail-out and the €750 billion ($980 billion) war chest created in May to defend the euro look to many Germans like a violation of the “no-bail-out clause” in the Maastricht treaty that created the euro. The government insists it is not, because the aid is voluntary and temporary. The constitutional court is evaluating this claim. The proposed successor, a permanent facility plus procedures to impose losses on creditors of insolvent countries, needs a treaty revision to pass constitutional muster.
Clearly Weber and Steinbrueck have sent a strong message they expect the Maastricht Treaty to be honored. Current ECB President Jean-Claude Trichet trashed the treaty with support of the rest of the board.
With Weber and Steinbrueck bowing out of the race, Mario Draghi Ex-Goldman Sachs Managing Director is Leading Candidate to Replace Trichet as ECB President.
Goldman Sachs Tentacles Everywhere
Inquiring minds are investigating the career details of Mark Carney governor of the Bank of Canada.
Before joining the Canadian public service, Carney spent thirteen years with Goldman Sachs in its London, Tokyo, New York and Toronto offices. His progressively more senior positions included co-head of sovereign risk; executive director, emerging debt capital markets; and managing director, investment banking.
Please consider the Canadian Association of Income Trust Investors article Mark Carney exempted Goldman Sachs from Flaherty’s income trust tax
Flaherty’s income trust was structured by Mark Carney in such a way that only the little investor was taxed and the big guys were given a free ride. Not only were the big guys given a free ride, this tax was imposed in such a way that the big guys were able to prey upon the small investor and expropriate wealth from the small investor in the amount of some $35 billion.
What would you expect from the architect of Flaherty’s income trust tax, Mark Carney, who spent his entire career at Goldman Sachs and wouldn’t have dealt with a single Canadian retail investor in his entire career and evidently doesn’t give a hoot about them and probably perceives them as ripe for the picking.
I cannot discuss the merits of that Canadian case because I do not know them. However, it is clear that Goldman Sachs has tentacles slowly infiltrating every nook and cranny, including various Central Banks and the SEC.
SEC Names ex-Goldman Sachs Employee to Oversee Asset Managers and Hedged Funds
While on the subject of ex-Goldman Sachs employees turning up in high-power jobs, please consider SEC Taps Goldman Sachs Executive as Division Head
The Securities and Exchange Commission has named Goldman Sachs Asset Management Chief Investment Officer Eileen Rominger to head its division overseeing asset managers and hedge funds.
Rominger will come to the SEC after nearly 30 years in the investment management business, according to an SEC press release Tuesday.
She managed equity funds at Oppenheimer Capital and at Goldman before becoming Goldman’s chief investment officer for its global portfolio management teams.
As I said a couple days ago, all we need now to complete the picture is for an ex-Goldman employee to run for president of the United States and for another ex-Goldman employee to replace Bernanke at the Fed.
Mike “Mish” Shedlock
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