Tag Archives: The Full Explanation Of How The ECB Broke Europe’s Bond Market

ZeroHedge – The Full Explanation Of How The ECB Broke Europe’s Bond Market – 16 March 2015

ZeroHedgeIt was almost three years ago to the day when Zero Hedge first explained the biggest problem facing Europe when it comes to unconventional monetary policy: the lack, not scarcity, but outright shortage of collateral.

Initially, our focus was on private-sector collateral, and if one had to summarize the key difference between the US and Europe in one chart, it would be this one, showing that while in the US the split between secured and unsecured funding was roughly even, in Europe, some 90% of corporate funding was on bank loan books, with only 10% in the form of (unsecured) corporate bonds (which also explains why in Europe NPLs, aka bad bank debt is by far the biggest problem facing the financial industry).

Read the full story at: www.zerohedge.com / link to original article

Advertisements