All measures taken by the central bank to inject or withdraw its monopoly money from the banking system. – Provision of ample liquidity with the aim of reducing government debt. This is seen as the wrong way to go. After all, a sovereign debt crisis was caused by more spending than revenue. However, one cannot use funds that helped create a crisis to fight that crisis. – See money market operations, banking system liquidity, liquidity squeeze, liquidity position, liquidity buffer, liquidity shock, liquidity regulation, quantitative easing. – Cf. ECB Monthly Bulletin of May 2008, p. 95 ff. (more detailed definition of liquidity policy), Deutsche Bundesbank Annual Report 2009, p. 41 (factors determining liquidity), (detailed account of the sovereign debt crisis; many overviews; literature references), ECB Monthly Bulletin of January 2014, p. 75 ff. (detailed account of the ECB’s liquidity policy; many overviews).
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University Professor Dr. Gerhard Merk, Dipl.rer.pol., Dipl.rer.oec.
Professor Dr. Eckehard Krah, Dipl.rer.pol.
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