The ECB sees no need to intervene in the Italian crisis, Reuters reports, as it sees sees no stress in bank deposits, inbterbank rates or cash auctions, and would not act "on the back of events of just a few days."
Italian bond markets are rallying, Italian bank stocks are up, and safe-haven US Treasury bonds are plunging as rumors of a rift between the populist leaders of Italy's Five-Star and The League movements prompts hopes that a 'worst case scenario' is off the table.
JPM investment bank chief Daniel Pinto warned that Q2 markets revenue will be flat compared with a year earlier, and down 15% from 2016, sending bank stocks - already slammed by the collapse in Italian bonds - sliding.
Germany might think they will dictate terms of the European Union, but the reality is that they have way too much at stake to enforce their will on the debtor nations. Any perceived overly restrictive conditions will just hasten the EU’s demise.
The European crisis is officially back, although in reality, the European crisis never left as all the ECB did was push it under the rag for a few years.
"The EU model is a failure... Twenty years later, the eurozone economy is running on a treadmill, subzero interest rates are the norm, and budget deficits are ubiquitous."
