Italy needs a precautionary rescue of up to $700bn from the US and the major powers
to head off the danger of a global crisis, a bail-out veteran from the International Monetary Fund has warned.
Ashoka Mody, the IMF’s former deputy director in Europe, said economic fall-out from the coronavirus is pushing Italy to the brink of “vicious negative feedback loop”, raising the risk of a financial chain-reaction through the international system.
Italy’s sovereign debt is the world’s third largest in absolute terms at over €2 trillion and is tightly interwoven with the banking system.
Italian bank stocks have halved in value since mid-February, almost guaranteeing a credit crunch and again raising the spectre of a sovereign-bank ‘doom-loop’ akin to events in 2011.
Ambrose Evans-Pritchard, Telegraph 11 March 2020
The EU can rewrite its rules and let governments borrow more to counter the crisis or let Italy go the way of Greece
https://www.theguardian.com/world/2020/mar/10/an-italian-financial-crisis-is-certain-the-big-question-is-how-contagious-it-is
Ashoka Mody, the IMF’s former deputy director in Europe, said economic fall-out from the coronavirus is pushing Italy to the brink of “vicious negative feedback loop”, raising the risk of a financial chain-reaction through the international system.
Italy’s sovereign debt is the world’s third largest in absolute terms at over €2 trillion and is tightly interwoven with the banking system.
Italian bank stocks have halved in value since mid-February, almost guaranteeing a credit crunch and again raising the spectre of a sovereign-bank ‘doom-loop’ akin to events in 2011.
Ambrose Evans-Pritchard, Telegraph 11 March 2020
The EU can rewrite its rules and let governments borrow more to counter the crisis or let Italy go the way of Greece
https://www.theguardian.com/world/2020/mar/10/an-italian-financial-crisis-is-certain-the-big-question-is-how-contagious-it-is
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