Merkel Advisor Feld: "Euro Crisis Will Return Shortly And With A Vengeance"

Tyler Durden's picture

For all the groundless, starry-eyed optimism permeating Europe's bureaucratic corridors of the fading oligarchy these days (because this time is not like every other time that, too, was different), there has always existed one sure, never-fail antidote: Germany, which without fail has managed to ground Europe any time its delusion of grandure hit escape velocity. Sure enough, while all the statist soothsayers who threatened with armageddon if the outcome of the Italian elections happened to be precisely the one that transpired, were stuck in backpedal mode, and scrambling to calm nerves that all shall be well after all, one person who refuses to play by the script is Lars Feld, member of panel of economic advisers to German Chancellor Angela Merkel, who in an interview with the Frankfurter Allgemeine Zeitung tomorrow says the euro crisis is to return shortly and "with a vengeance" as capital loss will lead to higher risk premiums for Italy’s interest rates.

From Handelsblatt, previewing the FAZ Wednesday edition:

The Italian economy would not find their way out of the recession, according to the pessimistic assessment by Lars Feld: "The sustainability of Italian public finances is in jeopardy. The euro crisis will therefore return shortly with a vengeance."


Apparently, the Italians were not ready to move on the path of reform that has been taken by Mr. Mario Monti, Field said.


"You can not expect that Italy's European partners or the ECB will stabilize the Italian economy, when its people are not ready for reform."

And making sure Feld is not alone, he was joined by Anton Boerner, head of Germany’s BGA exporters’ association, who in turn said Italy must reform tax, labor, judicial system or risk "irreparable damage" of euro. Finally, Boerner says if Italy not willing to reform, "we have to think about how to deal with a modified eurozone."

What exactly a "modified" eurozone means we don't know. We will, however, surely find out soon enough.

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q99x2's picture

May I suggest that Germany begin arresting the banksters that got them into this mess. More than enough evidence to start arresting them for commiting fraud.

UnpatrioticHoarder's picture

Must be time to jawbone the Euro lower again

Divided States of America's picture

Tank the markets, that should make the Italians wake up. Unless of course most Italians are broke and not invested in the stock market anymore.

knukles's picture



New EU lament:  It's Grillo's fault

walküre's picture

Germany has federal elections coming up in September (edit)

Watch for the party/candidate who talks down the Euro and pulls a Grillo. Sure to get the majority of the votes.

God forbid, the people would actually have a choice! I don't see any such party or candidate yet but there is still time to emerge.

disabledvet's picture

obviously i'm over here in the states and there are many much closer to this than i ever could imagine being...but i really doubt this will be the case in Germany. I think the memory of the hyperinflation in Weimar is very much remembered...and Germany simply put won't go there. "Taking out" Greece (so to speak) is one thing. Italy is a CORE member of the eurozone. this talk is more than just tough talk as well. these are words backed up by the full force of the massive German economy. One could argue with Italy ahem..."out of the picture" there is more...ahem..."breathing space"...for the euro to expand. Having said that i don't see how France can remain in the EZ should Italy be "exited." Obviously should this "final straw" happen then there are potentially some very profound political and security implications. i'm sure there are a lot of folks out there FAR more expert than me working through the scenarios but clearly you have to include the idea that such a breakup would be FAR from amicable. "there is no DeGaulle"...and i think truly a presence such as his is very much needed for Europe right now. But that was then...this is now.

magpie's picture

In German MSM no one gives a rats ass about the Weimar hyperinflation. The Greek and Spanish bailouts were also considered an impossibility, which leads us to conclude...

TruthInSunshine's picture

The results of yesterday's elections in Italy almost certainly spell the end of the € in anything remotely resembling what it has since its inception as a monetary union instrument of commerce (and at a level that was once considered to hold the potential to rival the USD as a near full reserve currency).

The EU never achieved what it ostensibly set out to at the outset because its articles of incorporation were fatally flawed in that there was no framework for a true and enforceable political union.

Now, the massive diminishment of the € as an instrument of commerce even intra-EU, even with the distinct possibility of a dramatically smaller core EU (we might see a future European Union Tier 1, Tier 2 and even a potential Tier 3), will amplify the adverse impact of everything that the EU braintrust got wrong from the start and which they perpetuated in a stupid game of kick-the-can.

I'd love to hear any countervailing opinions rebutting mine that the € is almost inevitably certain to be pounded into dust in the months and years to come.

Lore's picture

Regardless of how it might or might not be structured, now or in the future, the fact remains that Main Street Europeans NEVER WANTED IT IN THE FIRST PLACE.  When Hitler and Lenin wrote about amalgamation into a "United States of Europe," they were not concerned about the well-being of the electorate. As always, it boils down to DEBT and CONTROL.

Ghordius's picture

TIS, one countervailing thought: it's all based on the assumption that Italy truly wants to exit

have you ever had a shopping spree in an eastern bazaar? threathening to leave the shop in rage is called bargaining

your point of no framework for a true and enforceable political union is correct - there is no political will to that

even I do not want it - and may I point out again that EU and EZ are separate clubs

the magic word in all this is option: any currency exiting would have to find an anchor, eventually, and then you are back to step one

the logic of a currency war

TruthInSunshine's picture

Wouldn't the simplest path to allow the widely disparate (economically, politically & socially) nations of the EU to more efficiently rebalance their economies by allowing them to re-implement their own fiat currencies, that can be internally strengthened or weakened (depending on such things as whether they want to boost exports, etc.)?

A Germany and Spain or Italy sharing the same fiat currency does not allow for any such flexibility.

The € can't possibly do what it must be allowed to do because of the tremendous comparative and competitive disimilarities between EU Member States.

AGuy's picture

Or Germany dumps the Euro for the Deutch marks they printed up a couple of years ago. Germany will likely opt out of the euro, after they get tired of bailing out club med.





gkampou's picture

"Fixed" is right, just like a horserace......

NoDebt's picture

And you can turn the losing horses into yummy meatballs and eat them when it's over!

Sorry, couldn't help myself.

ArgentoFisico's picture

what about sayin Merkel "fuck off You and your fuckin mark-euro"?!

jldpc's picture

God damn that is a good idea/.

orez65's picture

German exports boomed with the creation of the Euro.

Interest rates of bankrupt European Nations (EU), like Greece, dropped to the same level as Germany's and now they could buy lots of stuff from Germany.

All of Germany was into the scam, not just the banks.

So arrest them all!

Accounting101's picture

Exactly! Enough of the false narrative expounding on the moral rectitude of the thrifty Germans. Germany and German banks had no problems with supplying cheap credit to the peripheral countries.

AGuy's picture

"German exports boomed with the creation of the Euro."

German exports would have boomed without the Euro as demand for German products in North America and Asia soared.

Bunga Bunga's picture

That would be anti-semitic.

TNTARG's picture

Deutsche Bank is one of the strongest, pal. It's the PIIGS who must turn their backs on them. Germans never will, I think.

Lord Of Finance's picture

I do not like to cut in line, but I must say in response to q99x2:


   Indeed. In fact I would go a step further. I suggest that Germany start rounding them up they way they did it in olden days, under the leadership of a shrill voiced lunatic with a Charley Chaplan moostache. Germany could finally make full reparations for the atrocities commited to millions of innocents some 7+ decades ago. How?

 By rounding up the guilty as hell banksters and put them all in camp where the only daily activity is back breaking labor, followed by agonizing scientific/medical experiments, and then straight to the firing squad AND finally, straight to the human barbeque pit.

smlbizman's picture

is it tomorrow over there now? or are we getting advance info......remember the rules gentlemen and ladies

McMolotov's picture

"Apparently, the Italians were not ready to get butt-raped by Mr. Mario Monti," Field said.

More accurate.

tickhound's picture



"ah si, la banana nel tubo di scappamento il trucco"

"ah yes, the banana in the tailpipe trick"

unrulian's picture

 "At an end your rule is, and not short enough was it"



John Law Lives's picture

This is off topic, but I came across this article today. This WILL infuriate many people:

Recluse's gold fortune to be auctioned for taxes
Auction selling gold coins left by Nev. recluse who lived modest life with millions in garage
By Matt Woolbright, Associated Press | Associated Press – February 26, 2013

The Thunder Child's picture

Auction fees, taxes, estate handling... County assesments... Thats 800k mr.....ummmmmmm, oh hes dead he wont care.

Michelle's picture

The eurozone will never have a fiscal union and keeping up the charade insults our intelligence. Let the damn thing collapse already.

LawsofPhysics's picture

Reform the people?  Reform the banking and financial sector motherfucker.  The "people" don't have shit to "reform".

Just Ice's picture

yea, those nasty Italians were out of line!  How dare they reject the mini NWO experiment...

magpie's picture

Get on with the show, give them the bailout already.

If you do it now, you can at least surrender to Bersani instead of Beppo or Bunga-Bunga.

Bingfa's picture

Good gawd, how many times we been here?

Let us up, we've had enough of all the BULLSHIT.

For the love of God. please

Bingfa's picture

LOL, somebody put a bullet in em and call it a mercy killing...

This is hilarious

ZippyBananaPants's picture

"nothing can kill this market, put a bullet in its head and its going higher, comet could hit NY city and it would go higher, im Cramer and my head is so far up my ass I can taste my farts before they form"

knukles's picture

"and my head is going higher"

Rustysilver's picture

Let me say this: thank  you Italians for what you have done.  I don't know how it will turn out in the end, but, at least, you have shown other people in Europe that one can attempt to change the status quo. My country, US, is so messed up, I see no hope.

monopoly's picture

So, it is Italy we have to worry about. OK, I thought Portugal, Spain, Great Britain and France were also a problem and they too would need more infusion of capital. I am glad that is not the case......Eh, what was that. Oh, they are all the problem. Hmmm.

Well, at least America is on sound footing as we tackle our spending problems......NO. We are the worst??

Oh my. We are so screwed.

Tango in the Blight's picture

Eventually some shit will happen. But you may grow old and die before it happens.

tony bonn's picture

all this means is that the chairsatan will continue his perfervid monetizing of european debt...

ebworthen's picture

Euro crisis please.

Italy leave the Euro, please.

Crush the Central Banks and the banksters who are putting regular folks into indentured servitude without representation.

Mark123's picture

I wish I lived in least they have cheap wine, great weather, great food and good looking women.


And, they have Grillo.

orez65's picture

Keep trying to figure out the "root cause" of this financial mess.

Conclusion: About. 90% of Americans and Europeans don't understand what MONEY is.

akak's picture

I think the figure must certainly be well above 90%.

99.44% pure and willful stupidity.

worbsid's picture

What's his name ... the delinquint vet ... said we have the right to be stupid.  It's stupid to say that in mixed company. 

Kirk2NCC1701's picture

Oh, I see:  In Q1 Japan crashes the Yen to lift exports a tad but monetize their debt a LOT.  In Q2 the UK takes its turn.  In Q3 the EU gets in on the cluster-ficken, and in Q4 it's America's turn. 

They take turns blowing (fiat inflation) and sucking (real wealth).  Ditto for 2014.  Boy do we feel... "cheap & used".  Bonga, Bonga!  In the meantime, while they're f-packing, the BRICs keep "stacking".

Who gets the Nobel-Krugman prize for this scheme?  Bernanke, Krugman, Rickards?