Francesco Saraceno | There are a number of ways, not necessarily politically feasible, to allow EMU countries to run semi-permanent government deficits. A first one could be to restore complete national budget sovereignty, (scrapping the Stability Pact). This would mean relying on market discipline alone for maintaining fiscal responsibility.
Yiannis Mouzakis via Macropolis | What you are going to read could very well be extracts from a Yanis Varoufakis interview in the first half of 2015, when – in a clumsy manner that rubbed everyone up the wrong way – he was advocating that Greece and its lenders should change course.
Italy is a founding country of Europe and the euro. It has an ailing economy, which is not obvious at first sight, but its political weakness is evident. Italy is sick because of northern Europe’s austerity policies. And it can’t be expected to recover on its own because any crisis in its illness might cause the euro to take a definitive tumble.
In 2016, Spain’s Energy Ministry needs to revise the parameters related to the adjustment of green energy premiums included in the 2013 electricity sector reform. The proposal which Energy Minister Alvaro Nadal has sent to the National Competition Commission, pending amendments in order to have it ready before end-year, has not gone down well with green energy producers. They say that the proposal, as it is, limits the premiums and does not allow them to reach the stipulated reasonable rate of return.
AXA IM | We believe elections in the coming weeks is quite unlikely, for three reasons. First, all parties except M5S (Five Star Movement) have little interest to go through early elections, as voting intentions polls show that “classic” right and left-wing parties would all lose a substantial number of seats in Parliament to the M5S and the Northern League.
The markets’ reaction to the latest measures adopted by the ECB has been very positive, although not all experts believe that the era of quantative easing (QE) is coming to an end. And looking beyond the rises in equity prices, analysts are in agreement that the increased flexibility of the asset purchase programme and the reduction in the average monthly volume is prejudicial for the peripheral countries’ debt.
Yiannis Mouzakis via Macropolis | Just as years of fiscal irresponsibility pushed Greece into its permanent state of crisis, seven years and numerous Eurogroups later it was still the fiscal side of things that made the biggest impression on developments at Monday’s Eurogroup.
The failure of Matteo Renzi, who wasn’t pursuing something which didn’t make sense, has almost immediate consequences for a tainted and confused Europe, but also for Spain. Because Spain needs a reform along the lines of Renzi’s proposal.
What is being called a “preventitive recapitalisation” of Monte dei Paschi is more than sufficient to provide the Italian and European banking sectors with some breathing space for the time being, avoiding the risk of contagion.
Most observers bet the Draghi would further extend its current asset purchase programme, shoring up confidence in the face of troubled times ahead. Some believed it might reduce the monthly volume, showing its intent to scale down little by little its massive balance sheet.