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The government said that at least $3.5 billion worth of bonds must be offered at an acceptable interest rate to go through with the swap.
Every week, the ECB announces a specified amount of cash funds it wishes to supply and sets the lower limit for the acceptable interest rate.
Once a crisis of confidence has occurred, governments find it difficult to raise the money they need at an acceptable interest rate.
Paul De Grauwe of the University of Leuven says that if Britain couldn't roll over its debt at acceptable interest rates, it could ultimately force the Bank of England to buy it.
It could find itself unable to raise money on the private markets at acceptable interest rates — even though its government debt burden, as a share of the overall economy, is only half what Greece carries.
In a recent article, the Financial Times indicated that 700 billion euros were lent by the ECB to Italian and Spanish Banks since no private funding is available at acceptable interest rates.
Similar(53)
Critical and difficult decisions, such as new allocation of resources or rationing services, may be made more acceptable to interest groups if they are taken in the context of a political process that has brought the main players together.
Earlier this year, WebMD called off a monthslong sales process for itself after having received no acceptable expressions of interest.
Tomorrow, the Treasury Select Committee will ask the outgoing Barclays chairman, Marcus Agius, about the state of mind of executives who thought it was acceptable to rig interest rates in Libor submissions.
That in itself is perfectly acceptable, but vested interests will be lobbying hard.
But what exactly are we supposed to find so horrendous that a coalition of western forces should descend upon the Middle East with the unattainable objective of restoring some kind of order acceptable to western interests?
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Justyna Jupowicz-Kozak
CEO of Professional Science Editing for Scientists @ prosciediting.com