The ECB lacks the lender-of-last-resort powers the Fed and Bank of England exercise

Evidence

The problem was that we had given up our money presses and independent exchange rates—our economic shock absorbers—to adopt the euro. Meanwhile, the European Central Bank, the institution that was supposed to stabilize the system, turned out to be a bit of fake central bank. It exercises no real lender-of-last-resort function. It exists to fight an inflation that died in 1923, regardless of actual economic conditions. Whereas the Fed and the Bank of England can accept whatever assets they want in exchange for however much cash they want to give out, the ECB is both constitutionally and intellectually limited in what it can accept. It cannot monetize or mutualize debt, it cannot bail out countries, it cannot lend directly to banks in sufficient quantity. — Mark Blyth, Austerity, 246

Categorization

• XREF: Pairs with Mattei’s account of central banks as the crucial fiscal backstop; the ECB as ‘fake central bank’ explains why the 2010s eurozone lacked that backstop. — connects to: Eurozone national central banks act merely as Target Two payment processors — Mark Blyth, Austerity: The History of a Dangerous…, 805; The ECB is legally barred from financing government deficits or debt — Clara E. Mattei, The Capital Order: How Economists…, 1739; Western Europe diverged from the floating-rate norm via the Bundesbank and EMS — Dieter Plehwe, Quinn Slobodian & Philip Mirowski (eds.), Nine Lives of Neoliberalism, 448 (+2 more)
• QUESTION: The claim that the ECB ‘exists to fight an inflation that died in 1923’ — German hyperinflation as the institutional founding trauma deserves source verification.

Broader Connections

• The ECB is legally barred from financing government deficits or debt #expands (0.85) — Clara E. Mattei, The Capital Order, 1739
• Eurozone national central banks act merely as Target Two payment processors #qualifies (0.78) — Mark Blyth, Austerity, 805
• The ECB’s institutional design copied the Bundesbank’s neoliberal design #expands (0.78) — Dieter Plehwe, Quinn Slobodian & Philip Mirowski (eds.), Nine Lives of Neoliberalism, 636
• Western Europe diverged from the floating-rate norm via the Bundesbank and EMS #complicates (0.75) — Dieter Plehwe, Quinn Slobodian & Philip Mirowski (eds.), Nine Lives of Neoliberalism, 448