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The Impossible Italian Job. The Italian Banking Crisis Would Complete Europe’s “Doom Loop”

Bank_Panic_in_Italy

  • The Impossible Italian Job. The Italian Banking Crisis Would Complete Europe’s “Doom Loop”
    by Don Quijones, Spain & Mexico, editor at WOLF STREET
    Italy’s repeated attempts to stave off a full-blown financial crisis and breathe life back into its moribund banking sector can be summed up in four words: too little, too late.


    In April, it set up a bad bank vehicle called Atlante that was expected to bail out the country’s most troubled lenders as well as allay growing fears of a systemic crisis within the financial sector. With just €5 billion of funds to its name, it did neither.

    Cue Plan B, which saw the EU in June grant permission for Italy to use “government guarantees” to create a “precautionary liquidity support program for their banks worth €150 billion. On the surface it seemed like a lot more money, but in the end it amounted to little more than a PR stunt. The stampede out of Italian banks barely missed a beat [As Fears of “Bank Run” Escalate, Italian Banks Get €150 Billion Bailout of Empty Promises].

    Finally, at the end of July things got seriously serious with the unveiling of Plan C: a third, much larger rescue deal for Italy’s chronically dependent and third largest bank, Monte dei Paschi. The deal involves a consortium of banks, led by JP Morgan, and in a secondary role, Italian investment bank Mediobanca, which will apparently help Monte dei Paschi raise €5 billion in new capital and sell €9.2 billion in bad loans at a deep discount to get them off its books.

    read more.
http://www.independent.co.uk/voices/why-italy-s-economy-is-about-to-collapse-a7091221.html

Click on image for article.

http://www.express.co.uk/news/world/691326/Italy-prime-minister-Matteo-Renzi-political-financial-break-down-Eurozone-European-Union

Click on image for article.

http://www.express.co.uk/news/world/688424/Struggling-Italy-banks-could-spark-financial-crisis-EU-refuses-to-help

If Italian banks fall, French and German banks are toast. The EU and Eurozone will collapse. Click on image for article.

http://sputniknews.com/europe/20160801/1043841943/italy-economy-crisis-banks.html

Click on image for article.

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August 22, 2016 - Posted by | Economics | , , , , , , ,

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