After the European elections has begun the Haggling over the EU top jobs. As a promising successor to ECB chief Mario Draghi, whose term of office ends in October, is Jens Weidmann, the current Bundesbank President. However, the 51-year-old German met with rejection, especially in southern Europe. This is not surprising.
Jens Weidmann is considered to be a Hardliner, as a “hawk“, which is working since years for a tighter monetary policy. The zero-interest rate policy of the Italian and ECB President Mario Draghi, he is criticized as a wrong, and dangerous.
“An exceptionally expansionary monetary policy period may be state, not least because it goes hand in hand with risks and side effects,” said Weidmann, according to the “Handelsblatt”. In the future, the monetary policy need more water under the keel, said the Bundesbank President. In clear text this means: interest rates must go up.
As the Only “no” vote
That it’s Draghi in the eight years of his tenure, has managed to fulfil its mandate and to keep the Euro stable and inflation under two percent, contrary to all the warnings from Germany – can be found in the Speeches of Weidmann’s no assessment.
Also voted Weidmann in September 2012, the ECB governing Council’s meeting as the Only “no” against the decision of his colleagues, under certain conditions, unlimited quantities of government bonds of the member countries buy. Previously had proved to be Draghi as the Savior of the Euro, as he did in July 2012, his legendary statement that the ECB was ready to do whatever is necessary to preserve the Euro.
recession-start
The Central Bank has saved not only Italy but the entire Eurozone to collapse. Of the subsequent zero-interest rate policy, Germany is also benefiting massively, can drive it but until now his budgets without new debt.
For the German savers, who buy the majority continue to refuse to share, it would be rising interest rates, of course, a good message. However, it is also undisputed: Many of the over-indebted European States would not tolerate higher interest rates. There are many “Zombie”businesses, which survive only thanks to the low interest rates. An increase in interest rates could unleash in the current environment, a recession in the Eurozone, which would also hit Germany with full force.
No supporters in southern Europe
In Italy, Spain but also in France, the candidate Weidmann, therefore, has no supporters. The fact that, according to the Dutchman Wim Duisenberg, the Frenchman Jean-Claude Trichet and the Italian Mario Draghi never a German, the ECB has led speaks for Weidmann as the top Euro keepers. Also the technical competence of Weidmann’s is not in question. He has eight years at the helm of the Bundesbank. Previously, he was head of Department IV (economic and financial policy) in the Federal Chancellery.
However, his attacks against the monetary policy, Draghi’s worsened his chances. Surveys among European Economists show that hawks like Weidmann’s are only given a slight chance to climb up to the seat of the head of the ECB. Of course, he could not kill on night lever, for governments, and capital markets were too dependent on the ECB, their former chief economist to the concerns of Jürgen Stark.
Numerous other candidates
Nevertheless, for the majority of the respondents economists, the Finnish Central banker Erkki Liikanen as a favorite for the Draghi-succession – even if Liikanen would be 69, if he would compete in the eight-year term of office.
the French Central Bank chief, François Villeroy de Galhau is highly traded, in addition, the Finnish Central Bank President Olli Rehn and the French ECB Executive Board member Benoît Coeuré. However, it is still unclear whether the Frenchman can be as a current ECB Executive Board member President. Weidmann is ranked among the Economists surveyed, only to rank five.
replacement candidate, Regling
Weidmann even keeps himself covered. He emphasizes, however, the fundamental claim of Germany to come in the choice of the ECB-the heads of the fed. “It would certainly be bad if the impression that there are certain nationalities that are excluded from the ECB presidency on principle,” Mr Weidmann said at the end of may. That would be policy, in his view, confidence in the money is undermined.
“The next President of the ECB does not need, in my view, only professional competence, but also broad support among the heads of state and government,” he added. Therefore, this is not something you should decide in a “fight coordination”.
Recently, Klaus Regling, the head of the Euro rescue, it was called a Fund as a replacement candidate in Germany. He is considered one of the architects of the Euro and has been touted as a possible successor to Jean-Claude Trichet, before Draghi got the Job. However, Regling as the Finn Liikanen at the office would be in November, is already 69 years old.
source: boerse.ard.de
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