Court proceedings in Germany began after more than 35,000 Germans filed a complaint against the European Stability Mechanism, claiming it violates the nation's central banking mandate. The trial has been widely covered by German media as policy makers argue over whether or not the European Central Bank is out of line. The euro remained strong on Wednesday morning despite the controversy and traded at $1.33, nearly its highest value since February. The trial began with 9 hour opening statements, with Finance Minister Wolfgang Schäuble arguing that the ECB's decisions were not under the German court's jurisdiction and that if the German government saw the ECB policies as infringing on its mandate, it would be a matter for the European Court. On the other side, the President of Germany's Constitutional Court countered by saying the bond buying plan's success is covering a larger issue; that the ECB has taken over power from national governments in a way that current European law and the German Constitution does not permit. Although the court won't issue a ruling until after Germany's general elections on September 22, the court doesn't have the ability to shut down the ECB's bond buying program as it doesn't have jurisdiction over EU entities. However, according to the Wall Street Journal, some are worried that the court could limit the ECB's ability to run the program by imposing limits on Germany's participation. If the German central bank limits its participation, or in a more extreme case, is barred from participating in the bond buying plan at all, the Outright Monetary Transactions could unravel and disrupt the market's current calm. The most likely outcome is that the court will rule that the ECB is not violating the German mandate, but some damage could already be done. Anti-euro protestors filled the streets outside the court with signs reading "ESM SLAVE." Included in the protest were members of the Alternative for Germany, a radical anti-euro party which has been gaining momentum ahead of the September elections.
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