Germany’s Constitutional Court has to determine if the European Central Bank’s (ECB) asset purchases constitute illegal state funding. If the judges rule the bond buying program is illegal, it could lead to chaos.
Boom Bust is joined by Mollye Barrows of America’s Lawyer to break down what’s in store for the Eurozone.
The ECB insists that its bond-buying as conducted under the quantitative easing program is not illegal, Barrows says. German plaintiffs, however, argue “the ECB is effectively bankrolling highly indebted EU governments by printing money and they fear German taxpayers are going to get settled with that debt.”
Barrows points out that European law forbids the banks from buying bonds and other assets directly from governments and participating in primary market debt sales, but it can buy from bond holders and the secondary market.
For more stories on economy & finance visit RT's business section