Moreover, not forbidding indirect purchases should be seen primarily as a means of permitting banks that buy government bonds to pledge them as collateral for refinancing operations, while bearing the full investment risk. The distinction between bond purchases from the government and from the banks that bought them from the government is a phony one that gives rise to myriad possibilities for circumvention.

I want you to buy me a government bond.

The similarity between the SMSF and OMTs also implies that at least one of the two institutions is exceeding its mandate. If government bond purchases are monetary operations, as the ECB claims, the ESM is overreaching if they are fiscal operations, it is the ECB that has crossed the line.

The ECB has already attempted to ease credit conditions by purchasing high quality asset backed securities. It has bought securities backed by cash flows from private sector mortgages, so called covered bonds, and it has floated the idea of buying corporate bonds and multilateral securities issued by the European Investment Bank.

I don't know.

Expresses its appreciation for the donation made by the Kingdom of Saudi Arabia, announced at the Donors Conference (Paris 2) of the amount of US 700 million in the form of securities and of purchasing government bonds.

Investors tendered 91.2 per cent of the 500 million in bonds due in 2006 and 95.7 per cent of the 600 million in bonds due in 2013.

BRUSSELS It has now been nearly half a year since the European Central Bank declared its intention to buy some 1.1 trillion ( 1.3 trillion) worth of eurozone bonds. When it first announced the so called extended asset purchase program in January, the ECB emphasized that it was only expanding an existing program, under which it had been buying modest quantities of private sector bonds, to cover government paper.

During the first seven months of 2010, China not only refrained from buying any more US government paper, but even began to sell its holdings. Each month, China sold a net sum of about 7 billion in US government bonds.

Debt buy back and Brady bonds11

The application of funds of an insurance company is limited to bank deposits, trading of government and financial bonds and other forms of fund application stipulated by the State Council.

Before January, this sequence of events was quite likely, but the ECB s bond buying program put a firebreak at each point of the contagion process. If holders of Portuguese bonds are alarmed by a future Greek default, the ECB will simply increase its bond buying with no limit to its buying power, it will easily overwhelm any selling pressure.

I don't know, Mammy.

Sierra Leone would issue iron ore bonds and Mongolia would issue copper bonds. Investors would be able to buy Guatemala s coffee bonds, Côte d Ivoire s cocoa bonds, Liberia s rubber bonds, Mali s cotton bonds, and Ghana s gold bonds.

Jamaica, for example, would issue aluminum bonds Nigeria would issue oil bonds Sierra Leone would issue iron ore bonds and Mongolia would issue copper bonds. Investors would be able to buy Guatemala s coffee bonds, Côte d Ivoire s cocoa bonds, Liberia s rubber bonds, Mali s cotton bonds, and Ghana s gold bonds.

Assuming a limit to foreign investors willingness to buy these bonds, Greeks would have to buy them. In an economy unequipped for growth, household wealth relative to wages would soar, and the labor supply would shrink, causing employment to contract.

In addition, the ECB could purchase EIB bonds on secondary markets, which would help to keep funding costs low or even reduce them. More important, purchases of EIB bonds would enable the ECB to undertake quantitative easing without triggering the degree of controversy implied by intervening in 18 separate sovereign bond markets, where concerns that ECB purchases would affect the relative pricing of sovereigns are very real.

Proponents of OMT counter that the Treaty forbids only direct government bond purchases indirect purchases in secondary markets are allowed. But the decision not to prohibit indirect purchases, opponents argue, may have been intended to allow the ECB to carry out weekly repo operations, following a practice used by the Banque de France to reduce fluctuations in short term interest rates.

BERKELEY When the European Central Bank announced its program of government bond purchases, it let financial markets know that it thoroughly disliked the idea, was not fully committed to it, and would reverse the policy as soon as it could. Indeed, the ECB proclaimed its belief that the stabilization of government bond prices brought about by such purchases would be only temporary.

The Federal Reserve s policy of long term asset purchases, also known as quantitative easing, has intentionally kept long term rates low. The Fed is buying Treasury bonds and long term mortgage backed securities at a rate of 85 billion a month, equivalent to an annual rate of 1,020 billion.

And cashing in a bond to pay for a ring.

He is the main buyer of U.S. Treasury bonds.

In response, central banks should purchase government bonds for cash in as large a quantity as needed to push their prices up as high as possible. Expensive government bonds will shift demand to mortgage or corporate bonds, pushing up their prices.

For all these reasons, purchasing private sector securities alone will not enable the ECB to achieve its stated goal of expanding its balance sheet by 1 trillion ( 1.2 trillion). Unable to vanquish the specter of deflation, ECB President Mario Draghi will need to continue working to build a consensus even better, unanimity within the bank s governing board for purchases of government bonds.

If Italy and Spain have budget surpluses and declining debt GDP ratios, financial markets will reduce the interest rates on their bonds without the proposed ECB purchases. That would remove the serious risk that the ECB could start buying bonds on the basis of agreed fiscal packages, and then be forced to react if governments fall short on implementing them.

Similarly, the quantitative easing (QE) that has defined many major central banks monetary policy in recent years does not involve buying or selling foreign assets. Under QE, the Federal Reserve buys and announces that it will buy assets the only difference is that these assets are longer maturity US government debt instruments and mortgage backed securities of various kinds, all denominated in US dollars.

Public and publicly guaranteed debt rose moderately, while bond financing fell dramatically by 40 per cent.

The Bank of Japan already holds government securities worth 40 of GDP, and it is committed to annual purchases worth 16 of GDP within the framework of Prime Minister Shinzo Abe s economic revitalization agenda. The mammoth size of the BOJ program implies that it has taken full control of the market for government paper.

I want you to buy me that bond.

But QE would present a problem for the ECB that the Fed and other central banks do not face. The eurozone has no centrally issued and traded Eurobond that the central bank could buy.

Adding 400 billion would increase the pool substantially. Together with asset backed securities, covered bonds, and corporate bonds, 1 trillion of assets the threshold widely thought to make quantitative easing by the ECB credible would be available for purchase.

The extra money is expected to percolate through the economy, quickening activity. The European Central Bank has just started a 1.1 trillion ( 1.17 trillion) bond purchase program to bypass the German veto on fiscal expansion.

(ii) Investments include securities acquired by the Organization to produce income.

So far, policymakers are talking only about exchanging old Greek bonds for cash (in buybacks) or new Greek bonds. It would be far preferable to exchange them for Eurobonds, backed by the full faith and credit of all eurozone countries.

The City of London has jumped into the breach, increasing its purchases, which in 2008 and 2009 amounted to only about 1 billion monthly, to an average of 28 billion in the first seven months of this year. Since the United Kingdom itself is a large capital importer, we can assume that the City is not holding the paper itself but merely restructuring it and then selling it to the world under a new name and with the London stamp on it.

Under the new system the State Housing Agency issues Government backed bonds and acts as a broker between the buyer and seller.

China s foreign exchange reserves, indeed, are facing a triple whammy a decline in the US dollar s purchasing power, a fall in the prices of US government securities, and possible inflation in the longer run.

(2) expenses on purchasing commercial insurances, securities, stock equities or collections and so on

Pushing up asset prices and pushing down the euro s exchange rate will require the ECB to buy bonds on the secondary market not the crisis countries bonds per se, but those of all eurozone members. In other words, it will require quantitative easing.

The ECB has promised to buy Italian and Spanish sovereign bonds to keep their interest rates down, provided these countries ask for lines of credit from the European Stability Mechanism and adhere to agreed fiscal reforms. Germany s Constitutional Court has approved the country s participation in the ESM, and Chancellor Angela Merkel has given her blessing to the ECB s bond buying plan, despite strong public objections from the Bundesbank.

By making it clear from the outset that it did not trust its own policy, the ECB practically guaranteed its failure. If it so evidently lacked confidence in the very bonds that it was buying, why should investors feel any differently?

The bonds can be sold to a worldwide market by insurance companies that incur major risks by writing policies. If the insurance companies can get a good enough price for such bonds, they can eliminate their exposure to the risk of a major disaster, thereby allowing them to issue policies to homeowners at a lower cost.

The European Union s approach to bank regulation encouraged financial institutions to load up on government debt supposedly a risk free asset. Now, given the profound sovereign debt crisis in the eurozone periphery, government defaults threaten to take down the big banks.

When there is no excess demand for cash, there will be no excess supply of the bonds and stocks that underpin and finance the economy s productive capital. Thus, expansionary monetary policy via standard open market operations by a central bank is the first item on the checklist of what to do in a financial crisis.

Due to the huge US budget deficit, the supply of American government bonds will increase astronomically in the years ahead. But there is no guarantee that demand for these Treasury notes among foreign investors including foreign governments will be sufficient.