Both corporate debentures and sovereign debts have been always dealt with utmost regard in the euro area as Europeans are noted for their scrupulous attitude to running finances. According to the long-lasting European tradition, Bundesbank President Jens Weidmann is fully aware of any treasury bill, a debt status, and an amount of indebtedness. Thanks to his remarkable insight, he is able to determine “the risky zone” when the eurozone’s sovereign debt is still under control. Jens Weidmann warns policymakers to realize risks of swelling public debts on the periphery of the euro area. Pointing to the need to end the preferential treatment of sovereign debt, Weidmann said sovereign debt is not risk-free and must be backed by capital. Further, he noted the "exposure to a single sovereign must be capped, just as is the case for any private debtor". The top official highlighted, "In the euro area we are already in the danger zone - at least with regard to public debt standing at 91% and corporate debt at 105%." Besides, Germany’s finance minister Wolfgang Schauble voiced concern that the European Central Bank is pursuing the stimulus policy which is making an adverse impact directly on Germany’s economy. This state of affairs could cause “bubbles” on financial markets. Meanwhile, the ECB is still keeping the headline borrowing rate at a record low of 0.05%. The regulator also slashed its deposit rate below zero to -0.2%. The margin loan rate was lowered to 0.3%.
