Does central bank insolvency matter?
Thank you for this brilliant article!
Excelente artículo. Y muy, pero muy pertinente para la realidad del país donde vivo, Argentina.
Wow, the injection that the Riksbank says it needs, SEK 80G, is about the size of the 2022 defence budget. I wonder if the spending of such huge amounts of money without much democratic oversight might lead politicians to want to reduce the power or independence of the Riksbank.
historically what has happened when interest rates have risen dramatically on central banks with large debts?
Greece didn't have sovereignty of its currency (couldn't just create the money) and i am not sure how it has fared since bankruptcy.
I believe the other option is bankruptcy and marking down the debts,