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Instead it will probably provide Treasury bills, or very short term loans, which are a proxy for cash, because otherwise it thinks that the scheme could complicate the way it controls the amount of money in the economy (monetary policy) in some unspecified way.
The problem, the panel notes, is that "the principles as announced are so broad that they provide Treasury with a means of justifying almost any decision".
Better knowledge of the characteristics of the loan, the homeowners, the servicer, or the modification, more prone to redefault will increase Treasury's understanding of the underlying problems that cause redefaults and provide Treasury an opportunity to address these issues proactively.
The European Investment Bank will provide "treasury management services and administrative support to the E.F.S.F. through a service contract," the bank's president, Philippe Maystadt, said, adding that there would be no European Investment Bank involvement in lending.
Its principal activities are to provide treasury and banking operations.
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