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"The treaty forbids monetary financing," he said.
The ECB says a rollover would amount to illegal monetary financing.
Covert monetary financing may sometimes be the least of several evils.
For critics the policy is tantamount to outright monetary financing of governments.
Opposition to the ECB action is usually made on the ground of monetary financing or inflation.
Corbyn's proposal, unlike orthodox monetary financing, would not add to the national debt – a major advantage.
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There is indeed the obvious danger that governments might easily become addicted to monetary finance to pay for private and public spending, which is why it is unlikely to be tried openly unless economic conditions worsen significantly.
Even if monetary finance was more likely to boost inflation than the exchange of debt for interest-bearing perpetuities, this is hardly an argument against it: it is only an argument for going more slowly.
AT: Monetary finance is like a medicine, which, taken in small quantities, can be very valuable, and taken in large quantities, is toxic.
Meanwhile, PBoC Governor Zhou Xiaochuan said that China will continue to reform monetary and financing systems to allow more flexibility in the CNY exchange rate.
In Latin America, the International Monetary Fund financed governments that embraced market forces while shunning those that were resistant.
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