Governing Council

Also points out that it is essential that Governments are prepared to activate European ease financial stabilization (EFSF) in the secondary market, according to the analysis of the ECB and recognizing the existence of exceptional circumstances on the financial market and risks for financial stability, a time that the EFSF is operational. The Governing Council of the ECB met this Sunday through a conference call to decide whether to buy sovereign debt of Spain and Italy, countries that have been attacked by speculators since July in the fixed income markets. The German representatives in the Governing Council of the ECB, and possibly also of other Nordic and Central European countries, are those that more problems come to the extension of this program of buying bonds in the secondary market by the fear to raise inflation and that the ECB assumes responsibilities related to fiscal policy before the indecision policy of the leaders of the euro zone. The purchase transaction was carried out on Monday, according to a financial source in Frankfurt. Weekend of conference call financial movement occurred once the Agency’s measurement of risk Standard and Poor (S & P) s EE UU – maximum – AAA debt rating downgraded to AA + after the close of U.S.

markets on Friday. The decision of the ECB tries to instil confidence and prevent this Monday a reaction of panic in the financial markets similar to that experienced with the bankruptcy of Lehman Brothers in 2008. This weekend there were contacts between Ministers or senior positions in finance of the G-7 and G-20 countries, as well as with heads of central banks. The French President, Nicolas Sarkozy, and German Chancellor Angela Merkel, were also considered essential to implementation of the measures announced by Italy and Spain to restructure its finances and increase quickly and complete your competitiveness. The EFSF, which is equipped with only 440,000 million euros and will be therefore insufficient to rescue countries in the size of Spain or Italy, you can buy debt in the market primary and secondary once the Council of the European Union (EU) modify the agreement framework, which could be before the end of September. Source of the news: the ECB will buy debt of Spain and Italy to avoid the contagion from the crisis

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