Mr. Trichet said it would be inappropriate for the ECB to lend to Europe’s main bailout vehicle, the European Financial Stability Facility. A number of both U.S. and European politicians—not least the European Union’s Economic and Monetary Affairs Commissioner Olli Rehn—have urged that the EFSF be given a banking license, which would allow it to borrow from the central bank. However, a number of ECB officials have said this would break the terms of the EU treaty on monetary financing of governments. “We consider that governments have all capacity to leverage the EFSF themselves,” Mr. Trichet said. “We cannot substitute ourselves for governments.”
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If the govs do it themselves then the problem of debt to GDP being too high is made even worse which is why all the new organisations are being created. An alphabet soup like 2009 in US but then the gov and Fed Reserve had spare borrowing capacity. It’s a different kettle of fish this time despite how the ignorant punter is reacting recently with the announcement of ‘EuroTARP’. Oh well no one ever said understanding economics was easy. If it was we would all be rich like Soros.