Andreas Vosskuhle, Chairman of the Second Senate of Germany's Federal Constitutional Court, announces the decision on Tuesday. AP
Andreas Vosskuhle, Chairman of the Second Senate of Germany's Federal Constitutional Court, announces the decision on Tuesday. AP
Andreas Vosskuhle, Chairman of the Second Senate of Germany's Federal Constitutional Court, announces the decision on Tuesday. AP
Andreas Vosskuhle, Chairman of the Second Senate of Germany's Federal Constitutional Court, announces the decision on Tuesday. AP

Top German court rules against ECB bond buying scheme


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Germany’s top court on Tuesday ruled the Bundesbank must stop buying government bonds under the European Central Bank's long-running stimulus scheme within three months unless the ECB can prove those purchases are needed.

The ruling deals a blow to a scheme, called Public Sector Purchase Programme, that has kept the euro zone's economy afloat during several crises and raises the prospect of a new conflict between the ECB and Germany, its largest shareholder.

However, the judges in Karlsruhe said their decision did not apply to the ECB's latest pandemic-fighting programme, a 750 billion euro (Dh2.9 trillion) scheme approved last month to prop up the coronavirus-stricken euro area economy.

German bonds and the euro sold off of after the ruling, with the benchmark 10-year Bund yield climbing to briefly touch a session high of -0.517 per cent. European stocks cut some gains and the pan-European STOXX 600 index was last up 1.05 per cent.

Ruling in a case that dates back three years, Germany's top court raised objections to the Bundesbank's participation in the PSPP, which was launched in 2015 and currently accounts for less than a quarter of the ECB's monthly asset purchases.

"The Bundesbank may thus no longer participate in the implementation and execution of the ECB decisions at issue, unless the ECB Governing Council adopts a new decision that demonstrates...the PSPP are not disproportionate to the economic and fiscal policy effects," the judges said.

The judges added the German central bank must also sell the bonds already bought, albeit based "on a – possibly long-term – strategy coordinated with" the rest of the euro zone. German bonds bought under the PSPP were worth 533.9 billion euros at the end of April.

Luis Garicano, a Spanish liberal member of the European Parliament, said the ruling posed a threat to the future of pan-European institutions.

"Very worried about the future of Europe post (the verdict). Europe cannot work if national Constitutional Courts decide unilaterally... Expect Hungary´s and Poland´s constitutional court to follow this precedent," he said on Twitter.

Amassing nearly 3 trillion euros of bonds since 2015, the ECB has long relied on bond purchases to support the economy through crises and a threat of deflation.

As the central bank of the euro zone's largest economy, the Bundesbank has taken the lion's share of those purchases.

With much of the euro zone now in lockdown to halt the spread of the virus, the ECB plans to print another 1 trillion euros to keep borrowing costs down for companies and governments.

But a group of academics in Germany has long argued that the ECB is overstepping its mandate, and that these buys constitute direct financing of governments - a contravention of the central bank's obligations under the European Treaty.

The German ruling comes after the European Court of Justice has already cleared the scheme, arguing that it does not constitute illegal financing and considers the ECB's measures proportional.

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The specs: 2018 Range Rover Velar R-Dynamic HSE

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Company profile

Name: The Concept

Founders: Yadhushan Mahendran, Maria Sobh and Muhammad Rijal

Based: Abu Dhabi

Founded: 2017

Number of employees: 7

Sector: Aviation and space industry

Funding: $250,000

Future plans: Looking to raise $1 million investment to boost expansion and develop new products

The specs
  • Engine: 3.9-litre twin-turbo V8
  • Power: 640hp
  • Torque: 760nm
  • On sale: 2026
  • Price: Not announced yet
Key facilities
  • Olympic-size swimming pool with a split bulkhead for multi-use configurations, including water polo and 50m/25m training lanes
  • Premier League-standard football pitch
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Scotland beat United States by four wickets

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Sunday, 10am, ICC Academy, Dubai - UAE v Scotland

Admission is free

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UAE currency: the story behind the money in your pockets
School counsellors on mental well-being

Schools counsellors in Abu Dhabi have put a number of provisions in place to help support pupils returning to the classroom next week.

Many children will resume in-person lessons for the first time in 10 months and parents previously raised concerns about the long-term effects of distance learning.

Schools leaders and counsellors said extra support will be offered to anyone that needs it. Additionally, heads of years will be on hand to offer advice or coping mechanisms to ease any concerns.

“Anxiety this time round has really spiralled, more so than from the first lockdown at the beginning of the pandemic,” said Priya Mitchell, counsellor at The British School Al Khubairat in Abu Dhabi.

“Some have got used to being at home don’t want to go back, while others are desperate to get back.

“We have seen an increase in depressive symptoms, especially with older pupils, and self-harm is starting younger.

“It is worrying and has taught us how important it is that we prioritise mental well-being.”

Ms Mitchell said she was liaising more with heads of year so they can support and offer advice to pupils if the demand is there.

The school will also carry out mental well-being checks so they can pick up on any behavioural patterns and put interventions in place to help pupils.

At Raha International School, the well-being team has provided parents with assessment surveys to see how they can support students at home to transition back to school.

“They have created a Well-being Resource Bank that parents have access to on information on various domains of mental health for students and families,” a team member said.

“Our pastoral team have been working with students to help ease the transition and reduce anxiety that [pupils] may experience after some have been nearly a year off campus.

"Special secondary tutorial classes have also focused on preparing students for their return; going over new guidelines, expectations and daily schedules.”

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What is graphene?

Graphene is a single layer of carbon atoms arranged like honeycomb.

It was discovered in 2004, when Russian-born Manchester scientists Andrei Geim and Kostya Novoselov were "playing about" with sticky tape and graphite - the material used as "lead" in pencils.

Placing the tape on the graphite and peeling it, they managed to rip off thin flakes of carbon. In the beginning they got flakes consisting of many layers of graphene. But as they repeated the process many times, the flakes got thinner.

By separating the graphite fragments repeatedly, they managed to create flakes that were just one atom thick. Their experiment had led to graphene being isolated for the very first time.

At the time, many believed it was impossible for such thin crystalline materials to be stable. But examined under a microscope, the material remained stable, and when tested was found to have incredible properties.

It is many times times stronger than steel, yet incredibly lightweight and flexible. It is electrically and thermally conductive but also transparent. The world's first 2D material, it is one million times thinner than the diameter of a single human hair.

But the 'sticky tape' method would not work on an industrial scale. Since then, scientists have been working on manufacturing graphene, to make use of its incredible properties.

In 2010, Geim and Novoselov were awarded the Nobel Prize for Physics. Their discovery meant physicists could study a new class of two-dimensional materials with unique properties. 

 

BIGGEST CYBER SECURITY INCIDENTS IN RECENT TIMES

SolarWinds supply chain attack: Came to light in December 2020 but had taken root for several months, compromising major tech companies, governments and its entities

Microsoft Exchange server exploitation: March 2021; attackers used a vulnerability to steal emails

Kaseya attack: July 2021; ransomware hit perpetrated REvil, resulting in severe downtime for more than 1,000 companies

Log4j breach: December 2021; attackers exploited the Java-written code to inflitrate businesses and governments

Three ways to boost your credit score

Marwan Lutfi says the core fundamentals that drive better payment behaviour and can improve your credit score are:

1. Make sure you make your payments on time;

2. Limit the number of products you borrow on: the more loans and credit cards you have, the more it will affect your credit score;

3. Don't max out all your debts: how much you maximise those credit facilities will have an impact. If you have five credit cards and utilise 90 per cent of that credit, it will negatively affect your score.

UAE currency: the story behind the money in your pockets