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ECB Lender of Last Resort

Here’s a noteworthy update from ZeroHedge:

Overnight, Peugeot, the struggling European car-maker, announced dismal results and significant over-capacity in Europe pushing its stocks down 6% ( down almost 13% since last week). The somewhat unsurprising twist was that the CFO said they were approaching the ECB about collateralized loans. As Bloomberg notes:

  • *PEUGEOT DISCUSSING WITH ECB, PRESENTING COLLATERAL, CFO SAYS
  • *PEUGEOT PRESENTING COLLATERAL ABOVE EU1 BLN TO ECB

So the ECB has now managed its other unintended consequence – to replace the entire bank intermediation credit creation channel (ring any bells?) as Europe embarks on its own ‘Cash-for-Clunkers’, ECB-Style.

 

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