Monday , March 25 2019
Home / Tag Archives: Italian banks

Tag Archives: Italian banks

“New Economic or Financial Crisis” in the Eurozone Could Start in Italy: French Government Frets

While contagion is definitely contained, the Eurozone “is not sufficiently armed to face a new economic or financial crisis.” French banks are heavily exposed to Italy. By Don Quijones, Spain, UK, & Mexico, editor at WOLF STREET. “Don’t underestimate the impact of the Italian recession.” This was the stark warning from French Economy Minister Bruno Le Marie in an interview with Bloomberg News. “We talk a lot about Brexit, but we don’t talk much about an Italian recession that will...

Read More »

Italy Guns For Glass-Steagall-Type Law to Break Up Banks, Cut Bailout Costs for Taxpayers

The banking lobby and the ECB will have a cow. By Don Quijones, Spain, UK, & Mexico, editor at WOLF STREET. On Friday, Italy’s coalition government unveiled new banking regulations that it hopes to pass in the coming months, including a rule that would separate banks’ commercial and investment arms. It would be the Italian equivalent of the Glass-Steagall Act, the 1933 U.S. law that separated commercial banks that took deposits, made loans, and processed transaction, from riskier...

Read More »

Italy’s New Government Eats Its Words, Joins Bank Bailout Club

Well, that didn’t take long. And whatever happened to the Eurozone’s new bail-in rule? By Don Quijones, Spain, UK, & Mexico, editor at WOLF STREET. Italy’s government, in its eighth month in power, has already bailed out a bankrupt bank, mid-sized Banca Carige, with public funds. If approved by European Commission and the ECB, it will be the fourth Italian bank rescue in just over two years. As Italian daily Il Sole 24 Ore points out, Italy’s populist government has adopted...

Read More »

QE Created Dangerous Financial Dependence, Italy Hooked, Withdrawal Next, ECB Warns

“Who will purchase the €275 billion of government debt Italy is to issue in 2019?” By Don Quijones, Spain, UK, & Mexico, editor at WOLF STREET. The ECB, through its army of official mouthpieces, has begun warning of the potentially calamitous consequences for Italian bonds when its QE program comes to an end, which is scheduled to happen at the end of this year. During a speech in Vienna on Tuesday, Governing Council member Ewald Nowotny pointed out that Italy’s central bank, under...

Read More »

No Rescue for Italy as Long as its Debt Crisis Stays in Italy?

Outside Italy, credit markets are sanguine, and no one has mentioned “whatever it takes.” By Don Quijones, Spain, UK, & Mexico, editor at WOLF STREET. Italy’s government bonds are sinking and their yields are spiking. There are plenty of reasons, including possible downgrades by Moody’s and/or Standard and Poor’s later this month. If it is a one-notch downgrade, Italy’s credit rating will be one notch above junk. If it is a two-notch down-grade, as some are fearing, Italy’s credit...

Read More »

Italy’s Debt Crisis Flares Up, Banks Get Hit, as Showdown with the EU Intensifies

Who will blink first? By Don Quijones, Spain, UK, & Mexico, editor at WOLF STREET. A serious showdown is brewing in the Eurozone as Italy’s anti-establishment coalition government takes on the EU establishment in a struggle that could have major ramifications for Europe’s monetary union. The cause of the discord is the Italian government’s plan to expand Italy’s budget for 2019, in contravention of previous budget agreements with Brussels. The government has set a public deficit...

Read More »

So Who Gets to Pay for Italy’s Banking Crisis?

The answers are beginning to take shape. By Don Quijones, Spain & Mexico, editor at WOLF STREET. “There is not and there will not be a banking crisis in Italy, nor will there be a European financial crisis coming from Italy.” Those were the emphatic words of EU Economics Commissioner Pierre Moscovici over the weekend. “We have the capacity to deal with the situation and it will be dealt with from both Italy and at the European level” he told France Info radio. Clearly, quixotic...

Read More »

Italians Vote “No,” Renzi to Resign, Banking Crisis Now Looking for Taxpayers

Teetering Eurozone banks exposed to flying shrapnel. A constitutional-reform referendum on tweaking the way a country governs itself, of the type Italy held today, would normally not be a big deal for banks in that country, and particularly not for banks in other countries, and it wouldn’t have much impact on currencies and credit markets. But these are not normal times for Italy, which is in the middle of a vicious banking crisis, and they’re not normal times for the EU either, which...

Read More »

The Fix Is Already In, as Italy’s Moment of Truth Beckons

Banks cannot be allowed, at any cost, to suffer the consequences of their own mismanagement, or worse. By Don Quijones, Spain & Mexico, editor at WOLF STREET. Italy holds a constitutional referendum on Sunday. Europe is sick and tired of national referendums, in the opinion of Jean Claude Juncker, the president of the European Commission. Over the past week, Juncker has urged EU leaders not to hold more referendums as he fears that other European electorates may take a leaf out of...

Read More »

Italy’s Banking Crisis Gets Addressed: How to Conceal a Problem that Threatens to Engulf the Entire Eurozone

The Art of Making Bad Debt Disappear. By Don Quijones, Spain & Mexico, editor at WOLF STREET. Markets can move in mysterious ways. Such was the case in Italy last week when the stock of the country’s third biggest and most beleaguered bank, Monte dei Paschi, surged 59%, from €0.17 a share to a totally whopping €0.27 a share, pairing its losses for this year to just 78%. But why? After all, nothing of real import happened over the last week, apart from an announcement from MPS’s...

Read More »