Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

Italy’s teetering banks will be Europe’s next crisis

economist.com

Post reply on HN
Print view View original

41–50 of 240 posts

Re: Italy’s teetering banks will be Europe’s next crisis

#41

Post by blahi »

ZenoArrow wrote: post #30
blahi wrote: post #25

Earlier quoted context omitted.

The world's population in the 1900 was 1,5B people. By 1970, it was twice that. By the year 2000, it was twice that again! And by 2050 it will be 9B. Where does the money for all those people would come from if not from borrowing (money from the future)?

Money does not need to be based on debt. Money is just a medium of exchange. There is no requirement for the creation of money to generate profit for the money creators, especially as the cost of creating digital money is near zero. If you want to look into it more, I'd suggest taking a look at debt-free money. https://en.m.wikipedia.org/wiki/Monetary_reform http://positivemoney.org/2011/10/debt-free-money/ http://po…

This requires a perfectly just world. We do not live in such a world and we probably never will.

Re: Italy’s teetering banks will be Europe’s next crisis

#42

Post by glenndebacker »

guelo wrote: post #24

It’s easy for Merkel to insist that Italy has to strictly follow EU rules since she doesn’t have to win an Italian election. The Euro just seems like a complete failure. Giant economies are limping along with 20% unemployment, unable to recover 8 years after the recession. In contrast the US has managed an OK recovery, now closing in on full employment. The problem is that each EU national leader is accountable only…

"The Euro just seems like a complete failure. Giant economies are limping along with 20% unemployment, unable to recover 8 years after the recession. In contrast the US has managed an OK recovery, now closing in on full employment."

You are aware that the problem with the EU banking reforms (or lack off) was also that the UK didn't wanted stricter rules with regards of the city of London... ? They even wanted an exemption.

In this regards I find it really intellectual dishonest that over the pound they are pointing fingers to the failure of Europe as they were part of the problem to begin with.

I do hope that from the moment that the UK stops dragging their feet and leave the EU it will be able to make swifter decisions instead of losing energy in constant oppositions.

Re: Italy’s teetering banks will be Europe’s next crisis

#43

Post by smcl »

basicplus2 wrote: post #26

EU now requires all member nations to enforce bail-in so ordinary depositors carry same risk as creditors of banks. America - Gone EU - Gone Canada - Gone New Zealand - Gone Australia - nearly gone - Turnbull was head of Goldman Sachs in Australia. All thanks to Goldman Sachs etc http://cecaust.com.au/releases/2014_03_20_Treasury_Bail_In.h... http://cecaust.com.au/releases/2015_11_27_G20_Accepts_Bailin... http://ceca…

I don't understand what the "- Gone" lines are and can't relate them to the first part of your comment. Did you miss something out?

Re: Italy’s teetering banks will be Europe’s next crisis

#44

Post by shoo »

basicplus2 wrote: post #26

EU now requires all member nations to enforce bail-in so ordinary depositors carry same risk as creditors of banks. America - Gone EU - Gone Canada - Gone New Zealand - Gone Australia - nearly gone - Turnbull was head of Goldman Sachs in Australia. All thanks to Goldman Sachs etc http://cecaust.com.au/releases/2014_03_20_Treasury_Bail_In.h... http://cecaust.com.au/releases/2015_11_27_G20_Accepts_Bailin... http://ceca…

Be aware: the above links point to press releases from the Citizen's Electoral Council - this is the most batshit insane political party I am aware of in Australia.

You don't get to print and distribute pamphlets talking about lizard people running the world and then get to be taken seriously.

Re: Italy’s teetering banks will be Europe’s next crisis

#46

Post by mac01021 »

blahi wrote: post #25
ZenoArrow wrote: post #23

Earlier quoted context omitted.

It's worse than just fractional reserve banking. The vast majority of the money supply is based off debt. Would recommend watching the 4 minute introduction on the Positive Money homepage for a quick overview of the current situation with money creation: http://positivemoney.org/

The world's population in the 1900 was 1,5B people. By 1970, it was twice that. By the year 2000, it was twice that again! And by 2050 it will be 9B. Where does the money for all those people would come from if not from borrowing (money from the future)?

Why does additional population require additional money?

Re: Italy’s teetering banks will be Europe’s next crisis

#48

Post by justincormack »

antr wrote: post #31
guelo wrote: post #24

It’s easy for Merkel to insist that Italy has to strictly follow EU rules since she doesn’t have to win an Italian election. The Euro just seems like a complete failure. Giant economies are limping along with 20% unemployment, unable to recover 8 years after the recession. In contrast the US has managed an OK recovery, now closing in on full employment. The problem is that each EU national leader is accountable only…

What does Merkel got to do with bad risk management and lax lending criteria by Italian banks? I struggle to find a link between your comment and the article.

Because the Germans lent a lot of the money, but they don't want it written down or they will have to bail out their banks.

Re: Italy’s teetering banks will be Europe’s next crisis

#49

Post by vidarh »

pjmlp wrote: post #33
guelo wrote: post #24

It’s easy for Merkel to insist that Italy has to strictly follow EU rules since she doesn’t have to win an Italian election. The Euro just seems like a complete failure. Giant economies are limping along with 20% unemployment, unable to recover 8 years after the recession. In contrast the US has managed an OK recovery, now closing in on full employment. The problem is that each EU national leader is accountable only…

As a foreign living in Germany I do appreciate the mentality that things "should be done the correct way", but many here don't understand you cannot just change a country's culture by forcing them to strictly follow EU rules. As it has already been proven by the lumping economies in the southern Europe, people will suffer and everyone will just make use of black market for jobs and goods to survive at any cost or jus…

> Assuming the Brexit works for the UK, I am just waiting to see who's next.

Given that the indications so far is that the Brexit vote has made attitudes towards the EU far more positive so far, it'd need to be amazingly successful for the UK for anyone else to leave at this point, and I don't anyone here that don't expect it to be a massively painful experience, even if they voted to leave.

Re: Italy’s teetering banks will be Europe’s next crisis

#50

Post by simonh »

charlesdm wrote: post #34
pjmlp wrote: post #33

Earlier quoted context omitted.

As a foreign living in Germany I do appreciate the mentality that things "should be done the correct way", but many here don't understand you cannot just change a country's culture by forcing them to strictly follow EU rules. As it has already been proven by the lumping economies in the southern Europe, people will suffer and everyone will just make use of black market for jobs and goods to survive at any cost or jus…

As often with things in life, is there really a correct way? I mean, yes, there are laws saying banks cannot receive state aid, but they were only introduced recently. Does that really mean we should let a massive bank (or multiple banks) go bankrupt? Given the global financial system is so interconnected, only a fool would think this would have no impact to the german economy. I don't mind rules, but every rule is m…

You manage a German bank. You follow strict capitalisation rules, are careful about the loans you make and operate your business according to the highest principles.

You clients start doing more and more of their business with an Italian bank that has poor capital reserves and a shoddy loan book and is losing money, but offers better terms to customers. The bank looks like it's going to fail, so the Italian government props it up with cheap credit and buys it's bad loans at above market rates so that it can stay in business - and keep winning business off you because it's still offering better terms to customers. Plus now those customers know the bank won't go bust and they can rely on it because the Italian government will support it no matter what.

The customer's business is being indirectly subsidised by the Italian government through below-market banking fees. Why should they ever do business with you again?

Post reply on HN