Italy, Spain Spurn ECB Bond-Buying Plan

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By Trey Thoelcke Published

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One of the problems with the ECB bond-buying plan, which was hailed last week as a way to help curb the borrowing costs of financially troubled nations, is that it may have no takers. Italian Prime Minister Mario Monti told CNBC that his country has no intention of drawing from the facility. Spain also may avoid borrowing for as long as possible.

There are two reasons for the reluctance. The first is that borrowing would signal that a nation has moved to the brink of real trouble. It is hard to argue that Spain is not there already, but that does not mean it wants to admit its severe problems. The other reason is that any borrowing has to be coupled with budget reforms approved by EU authorities. Spain and Italy want to avoid this kind of stranglehold if possible.

Barron’s reports:

Everyone is of course looking at Spain and Italy, but they seem in no hurry to raise their hands. Today, GMP Securities’ Adrian Miller asks “whether the plan will ever get off the shelf of the ECB as Spain and Italy have both indicated they are in no hurry to make an official request for aid. Indeed, while Italy’s Mario Monti announced the ECB bond buying plan reduced the stigma of asking for aid as “the drama in the word ‘help’ has been reduced”, he said he was trying to avoid seeking aid. Monti indicated it was premature to comment on the details of the OMT plan.”

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About the Author Trey Thoelcke →

Trey has been an editor and author at 24/7 Wall St. for more than a decade, where he has published thousands of articles analyzing corporate earnings, dividend stocks, short interest, insider buying, private equity, and market trends. His comprehensive coverage spans the full spectrum of financial markets, from blue-chip stalwarts to emerging growth companies.

Beyond 24/7 Wall St., Trey has created and edited financial content for Benzinga and AOL's BloggingStocks, contributing additional hundreds of articles to the investment community. He previously oversaw the 24/7 Climate Insights site, managing editorial operations and content strategy, and currently oversees and creates content for My Investing News.

Trey's editorial expertise extends across multiple publishing environments. He served as production editor at Dearborn Financial Publishing and development editor at Kaplan, where he helped shape financial education materials. Earlier in his career, he worked as a writer-producer at SVE. His freelance editing portfolio includes work for prestigious clients such as Sage Publications, Rand McNally, the Institute for Supply Management, the American Library Association, Eggplant Literary Productions, and Spiegel.

Outside of financial journalism, Trey writes fiction and has been an active member of the writing community for years, overseeing a long-running critique group and moderating workshop sessions at regional conventions. He lives with his family in an old house in the Midwest.

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