By Simon Kennedy and Anne-Sylvaine Chassany
Trichet acknowledged his own central bank had taken on risk by boosting liquidity and accepting lower-rated securities as collateral for loans.
“We’re taking risks and we’ve made decisions that increased our risks, because we were facing a systemic liquidity crisis of first importance,” he said. The ECB is an “inspirer of confidence,” Trichet said.
Yes, and now with the Fed’s money via the swap lines, and into a slowing economy.