Sunday, 01. January 2017
Italy, after the resignation of Prime Minister Matteo Renzi, economically and politically on shaky legs. Ifo chief Fuest fears the worst, and warns of dire consequences for the German taxpayer.
Ifo chief Clemens Fuest fears that Italy could be a long-term exit from the Euro-Zone. “The level of prosperity in Italy, is at the level of 2000. If nothing changes, by the Italians at some point: We don’t want anymore of this Eurozone,” said Fuest, the Berlin “daily mirror”.
problems there would be, in his view, even if Italy should submit an application to the bailout Fund, the ESM. “With his consent to a bailout program for Italy, the Bundestag would not burden the taxpayers of the risks, the amount of which he knows and can’t control,” said Fuest.
The European Central Bank has announced plans to purchase unlimited quantities of Italian government bonds, there should be a rescue program for Italy. Behind the ECB, the taxpayer, however, on the national Central banks. “So you would leave the ECB, the decision about how much credit Germany Italy granted,” said Fuest. “Under these conditions, the Bundestag is expected to approve the ESM program actually does.”
the Economist to the banking system. The European banks not be crisis, fears Fuest. “The policy has not done so in Europe after the financial crisis, enough to stabilize the banks.” Although measures had been taken, but not the right.
“The Supervisory interfere with your specifications, but is now strongly in the business model of the banks – where you have to ask whether you can be the judge of that at all right,” said Fuest. “Instead, it would be better if you would require more capital from the banks.” As an example, he cites the US, where the banks are very much faster from the financial crisis have recovered.