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How will the Italian crisis affect the EU.


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Old 05-12-2016, 11:56
onecitizen
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Is this the beginning of the end ? http://www.forbes.com/sites/schifrin.../#3bf101809945
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Old 05-12-2016, 12:05
batdude_uk1
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Hopefully it is.
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Old 05-12-2016, 12:10
nic6
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Great news another nail in the EU coffin.
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Old 05-12-2016, 12:16
batdude_uk1
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Can we nitjust go back to each country having their own currency?
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Old 05-12-2016, 12:19
jmclaugh
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It is hardly a crisis as things are exactly as they were before the referendum on the constitution and all it really means is things will stagger on as before.
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Old 05-12-2016, 12:20
Cheetah666
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Can we nitjust go back to each country having their own currency?
What's it got to do with you if other countries want to be in a currency union?
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Old 05-12-2016, 12:23
taurus_67
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The E.U. will ingnore it .
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Old 05-12-2016, 12:35
Hazy Davy
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The finance minister who is favourite to take over wants the Eurozone to have its own central government and cabinet - probably to get Germany to underwrite the Italian economy. He's very much an integrationist and federalist. So the Italian government will be pushing for more Europe. So in the short term it could help the Eu establishment.
In the longer term it probably depends on how successful the new guy is with their economic problems.
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Old 05-12-2016, 12:42
JackKlugman
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The Italian political turmoil is nothing compared to the massive crisis withat Italian banks that could collapse the eurozone. The Italian banks made hundreds of billions of euros in bad loans which they will never get back and creating a "bad bank" to off load them is no longer a option.

The banks are too large to save when not if they collapse and when they do they will trigger a Greece style crisis in the 3rd largest economy in the euro zone.

It really is brown trousers time for the Italians if their banks collapse
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Old 05-12-2016, 12:51
Bluescope
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No. See the problem is no matter how bad being in the EU is as with Greece countries like Italy would be a damn sight worst off with their own currency. The Lira was worth 2,000 to the euro when they exchanged it.

If you think Italy has problems now they are going to get a damn sight worst if they have to go back to their own currency and borrow money on the open market.

The problem is Italy has a horrible banking system, massive problems of corruption and a public sector which is far to large and expensive to run. The vote to try and tackle these issues has been rejected in some protest vote against the EU.

Leaving the EU is not going to fix any of these issues. They existed in Italy way before they joined the EU and so far they have done nothing to fix them while being in the EU.

The problem is that while people dont like the EU or the Euro what other options do you have at the end of the day ? Going back to the Lira does not fix any of these issues.
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Old 05-12-2016, 13:37
corf
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The Lira was worth 2,000 to the euro when they exchanged it.
Why is the value of Lira an issue? It historically been between 1500 and 3500 against the pound since world war 2 following a couple of post war devaluations. You make it sound like a negative when IMHO it is a positive.

At least with the Lira they had fiscal control and could lower its value to create value in the country for foreign investment and job creation.

Italy and Spain desperately needed fiscal control during the financial crisis.
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Old 05-12-2016, 13:49
Eurostar
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Why is the value of Lira an issue? It historically been between 1500 and 3500 against the pound since world war 2 following a couple of post war devaluations. You make it sound like a negative when IMHO it is a positive.

At least with the Lira they had fiscal control and could lower its value to create value in the country for foreign investment and job creation.

Italy and Spain desperately needed fiscal control during the financial crisis.
The place was hugely unstable politically long before they joined the Eurozone and has had over 60 governments since WW2. Perhaps they may well have benefitted from being outside the Euro during the financial crash but this fact can't just be taken in isolation from everything else.
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Old 05-12-2016, 13:51
voteout
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It really is brown trousers time for the whole of Europe -- the UK included -- if their banks collapse
Fixed that for you.
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Old 05-12-2016, 14:39
corf
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The place was hugely unstable politically long before they joined the Eurozone and has had over 60 governments since WW2. Perhaps they may well have benefitted from being outside the Euro during the financial crash but this fact can't just be taken in isolation from everything else.
I was only pointing out that somone doesnt understand finance when negatively talking about a 2000:1 exchange rate suggesting it was a bad thing - when in reality it wouldnt matter if the lira was 1:1 or 2000:1 before joining the euro.

The italian government hasnt exactly become any more stable post eu. Yesterday Renzi was trying to change it to provide more stability.
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Old 05-12-2016, 14:51
voteout
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Yesterday Renzi was trying to change it to provide more stability.
Which is always a mistake in Italy.

The country encapsulates perfectly what happens when you allow populists to rule a state for generations. Trump's USA will be in much the same state in 2024 if he's re-elected.
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Old 05-12-2016, 14:58
Eurostar
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I was only pointing out that somone doesnt understand finance when negatively talking about a 2000:1 exchange rate suggesting it was a bad thing - when in reality it wouldnt matter if the lira was 1:1 or 2000:1 before joining the euro.

The italian government hasnt exactly become any more stable post eu. Yesterday Renzi was trying to change it to provide more stability.
Indeed, it seems Italians love saying 'no' to everything. Renzi was at least trying to introuduce some radical reforms to society but they've voted those down as well. Perhaps the No side might come up with some constructive proposals but I wouldn't be holding my breath.
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Old 05-12-2016, 15:09
Cheetah666
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Indeed, it seems Italians love saying 'no' to everything. Renzi was at least trying to introuduce some radical reforms to society but they've voted those down as well. Perhaps the No side might come up with some constructive proposals but I wouldn't be holding my breath.
Nor would I. Silvio Berlusconi just wants to get his bum back on his favourite seat and the 5 star lot don't know what they want. They're worse than the AAA/PBP lot in Ireland.
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Old 05-12-2016, 15:18
MC_Satan
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I don't know a great deal about Italian politics (although I always had a sense that the whole lot of them were corrupt to some degree). This Five Star lot seem a bit of a strange conglomeration of ideas. Mind you, has Italy ever been governed well?
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Old 05-12-2016, 15:29
niceguy1966
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Indeed, it seems Italians love saying 'no' to everything. Renzi was at least trying to introuduce some radical reforms to society but they've voted those down as well. Perhaps the No side might come up with some constructive proposals but I wouldn't be holding my breath.
You can't call a referendum in 2016 and expect people to do what's best for themselves! And who cares if the winning side has no proposals!

Business as usual for this year!
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Old 05-12-2016, 15:50
Tanky
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The Italian bank Monte dei Paschi, is going to fall first. The bank is waiting on a large investment from a consortium of investors, they were already in the process of being rescued. However, with the events that's unfolded, no one in their right mind, would invest in the failing bank, why risk it?

With the bank being so integral to Italy, the government is going have to nationalise. This will greatly affect the other Italian banks, as confidence will be lost.

The shares on Italian banks have plummeted, and they can only go further down, after investors will likely pull out of a rescue plan for Monte dei Paschi.
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Old 05-12-2016, 16:24
Eurostar
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I don't know a great deal about Italian politics (although I always had a sense that the whole lot of them were corrupt to some degree). This Five Star lot seem a bit of a strange conglomeration of ideas. Mind you, has Italy ever been governed well?
Some Brexit supporters have been holding up the Five Star Movement as an Italian version of UKIP but they are nothing of the sort : they are a bizarre mish mash of ideas including being strongly pro-environment and wanting to abolish party politics completely.
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Old 05-12-2016, 16:28
voteout
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Some Brexit supporters have been holding up the Five Star Movement as an Italian version of UKIP but they are nothing of the sort : they are a bizarre mish mash of ideas including being strongly pro-environment and wanting to abolish party politics completely.
'A bizarre mish mash of ideas'... seems to sum up UKIP rather well actually.
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Old 05-12-2016, 16:30
niceguy1966
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'A bizarre mish mash of ideas'... seems to sum up UKIP rather well actually.
and until recently "led by a clown" would have fitted too!
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Old 05-12-2016, 16:32
Cheetah666
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and until recently "led by a clown" would have fitted too!
And indeed still does.
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Old 05-12-2016, 16:52
JackKlugman
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The Italian bank Monte dei Paschi, is going to fall first. The bank is waiting on a large investment from a consortium of investors, they were already in the process of being rescued. However, with the events that's unfolded, no one in their right mind, would invest in the failing bank, why risk it?

With the bank being so integral to Italy, the government is going have to nationalise. This will greatly affect the other Italian banks, as confidence will be lost.

The shares on Italian banks have plummeted, and they can only go further down, after investors will likely pull out of a rescue plan for Monte dei Paschi.
The problem is that the Italian government ( who ever that is) can't afford to bail out or nationalise the banks. The Italian economy is a rotten shack one good kick on the door and the whole lot will collapse and take the euro zone with it.

The collapse will happen only question is when
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