It’s interesting because in Europe things calmed down in the past year, particularly in terms of the yield on Portuguese paper, French paper, etc. This was in the aftermath of Mario Draghi saying, ‘We will do whatever it takes.’
So the ECB telegraphed to the world that they would step in if necessary and buy the sovereign paper of countries such Portugal, France, Greece, or others. This was a move to cap yields. In a sense Draghi was successful because he didn’t have to buy any paper because the investors stopped panicking, at least so far.
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