This is very interesting because the president of the German central bank, Jens Weidmann, had this to say in an 2014 interview published on the website of Bundesbank:
But the USA, England, Japan - they have all been buying up an abundance of government bonds since the financial crisis. Why are we in Europe, in particular, so cautious?
There are good reasons for this. First and foremost, we have a currency union and not a federal state. We have agreed to share a single currency but that each nation would be individually liable for its sovereign debt - because each country also individually decides on its fiscal and budget policy. However, once euro-area central banks begin to buy sovereign bonds of all countries, they then instantly assume joint liability. They together, and thus ultimately the taxpayer, would be on the hook for losses on these purchases.
Wrong. The taxpayer is not ultimately on the hook for losses at the central bank stemming from purchases of any financial assets, including government bonds. What is wrong today must have been wrong on 2014.
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