Keeping it secret: A woman with umbrella walks on a railway bridge over the river Main near the European Central Bank in Frankfurt. The ECB has been very secretive about the CSPP. It only publishes a list of company debt securities it holds, but not amounts. — AP
THE global synchronised economy recovery has turned into a global synchronised economic downturn. The outlook seems to be getting bleaker by the day, and major central banks are hinting that they may need to keep monetary policies loose. The European Central Bank (ECB) has even suggested that it could start buying corporate bonds again. Let’s hope it doesn’t come to that because it’s becoming evident that central bankers make for bad capitalists.
Consider Germany’s AG Bayer, which agreed to buy Monsanto in May 2016 for US$66bil in what was then the largest all-cash merger ever announced. The deal was controversial from the start as Bayer was going to need to raise billions of dollars. Traditionally, this means a company must go on a roadshow and explain its plan in great detail. Without evidence of a credible plan, capitalists will not part with their money.
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