1. What is the main argument for the ECB to be a lender of last resort?
  2. Evaluate the inflation risk arising from lender of last resort operations in the government bond markets.
  3. Evaluate the moral hazard risk arising from lender of last resort operations in the government bond markets.
  4. The German Constitutional Court ruled in 2014 that the OMT programme of the ECB is illegal and insists that the OMT programme would be limited in size. What would be the implication of this restriction for the Eurozone?
  5. Why did the European Court of Justice brush the objections of the German Constitutional Court aside?
  6. Do you think the European monetary union is sufficiently embedded in a political union to survive in the long run?
  7. What areas would you give a priority in the process of political unification?
  8. The European Commission has been given new responsibilities in the framework of the ‘six-pack’ legislation. Explain the nature of these responsibilities. Is this a step in the right direction?
  9. Explain why a successful banking union also implies some form of budgetary union.