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Max Keiser 2019-02-06 13:10:45

Summary:
– ITALEXIT: Italy to crash out of Euro and ‘rock EU to its foundations’ – Italy’s debt crisis will lead to default, exit from the euro, or both claims respected economist Bootle – Italy has fallen back into recession with its economy shrinking by 0.2% in the last quarter – “When Italy finally blows up, it will cause both a banking crisis that will shake the European economy and a political crisis that will rock the EU to its foundations”by Roger Bootle of Capital Economics in the  Daily Telegraph Last week’s data showing a drop in Italian GDP in Q4 of last year confirmed what many observers had already suspected: Italy is in recession. Or rather, in another recession, for this follows similar phases in 2008, 2011 and 2012. Where is this going to end? Although we have

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– ITALEXIT: Italy to crash out of Euro and ‘rock EU to its foundations’
– Italy’s debt crisis will lead to default, exit from the euro, or both claims respected economist Bootle
– Italy has fallen back into recession with its economy shrinking by 0.2% in the last quarter
– “When Italy finally blows up, it will cause both a banking crisis that will shake the European economy and a political crisis that will rock the EU to its foundations”

by Roger Bootle of Capital Economics in the  Daily Telegraph

Last week’s data showing a drop in Italian GDP in Q4 of last year confirmed what many observers had already suspected: Italy is in recession.

Or rather, in another recession, for this follows similar phases in 2008, 2011 and 2012.

Where is this going to end?

Although we have got used to weak economic performance from Italy, for much of the post-war period Italy grew rapidly. In 1987 its GDP even briefly overtook the UK’s. It subsequently dropped down the international league tables so that by the time the euro was formed in 1999 it was already a weak performer. But the euro has made matters worse. Since its formation, Italy has grown by only 9pc.

By contrast, the poor old UK, self-excluded from the benefits of the single currency, has grown by 44pc. Funny that.

It is perhaps surprising that it has taken so long for Italy to reach the current impasse.

Why Italy’s Debts Are Europe’s Big Problem. Click to enlarge. Source: Bloomberg

There are several factors that have kept an incipient crisis at bay. First of all, until recently there was hope. Italy couldn’t just carry on as before and being in the euro offered a real alternative. It may well have been an uncomfortable route, but austerity and “internal devaluation” were supposed to make Italy competitive while also improving the public finances.

Click here to read full story on Goldcore.com.

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