By Giancarlo Bergamini, June 26th 2016
A slow-moving train wreck
During the weeks leading up to the UK’s leave-or-remain referendum, the sufferings of Italy’s banks were in plain sight even to the casual observer. Arguably, the deep roots of that crisis trace back to the comatose state of the national economy (and only marginally to the misconduct of certain bankers, which, however, fills the bulk of press coverage), but it was incumbent on policymakers (not only the monetary authorities) to avert such an outcome. Discussing whether they have fulfilled their duty is the aim of this brief analysis.
Circumstantial evidence shows that the concerned institutions (Basel, European Commission, Eurogroup, European Central Bank and respective Italian lackeys), rather than securing the stability of the banking system, have notably contributed to triggering the crisis. Their policies have been implemented along two main lines of action: [Read more…]