{"id":17030,"date":"2016-01-28T11:16:07","date_gmt":"2016-01-28T16:16:07","guid":{"rendered":"http:\/\/olduvai.ca\/?p=17030"},"modified":"2016-01-28T11:16:24","modified_gmt":"2016-01-28T16:16:24","slug":"who-gets-to-pay-for-the-italian-banking-crisis","status":"publish","type":"post","link":"https:\/\/olduvai.ca\/?p=17030","title":{"rendered":"Who Gets to Pay for the Italian Banking Crisis?"},"content":{"rendered":"<header>\n<h3 class=\"entry-title\"><a href=\"http:\/\/wolfstreet.com\/2016\/01\/27\/who-pays-for-the-italian-banking-crisis\/\" target=\"_blank\">Who Gets to Pay for the Italian Banking Crisis?<\/a><\/h3>\n<\/header>\n<div class=\"entry-content\">\n<p><strong>The missing Capital Buffer.<\/strong><\/p>\n<p>Six years after Europe\u2019s sovereign debt crisis began, the Eurozone\u2019s third largest economy, Italy, has finally decided to do what just about every other country has done when facing a full-blown, almost out-of-control banking crisis: to set up a bad bank to hide its worst debt.<\/p>\n<p>It was only a matter of time: in the last six years, Europe\u2019s economies have been drowning in an ever-expanding vitrine of bad debt \u2014 and none more so than Italy, where non-performing loans have soared to more than\u00a0<a href=\"https:\/\/www.google.es\/webhp?sourceid=chrome-instant&amp;ion=1&amp;espv=2&amp;ie=UTF-8#q=350%20billion%20euros%20non%20performing\">350 billion euros<\/a>, a fourfold increase since the end of 2008. At 18%, Italy\u2019s ratio of nonperforming loans is more than four times the European average (and Europe\u2019s banks are in worse shape than America\u2019s). It\u2019s the equivalent of 21% of GDP in a country that boasts Europe\u2019s second highest public debt-to-GDP ratio (130%), just behind Greece, and where the banks hold over 70% of the country\u2019s debt.<\/p>\n<p>To make matters even worse, if Brussels gets its way, Italy\u2019s government will not be able to dip into future taxpayer funds to stop its debt-laden banks from dropping like flies. European law no longer allows that sort of thing. Well, not really. Now, in the wake of new regulations that came into effect at the beginning of this year, collapsing\u00a0banks in Europe will be \u201cresolved\u201d with the funds of stockholders, bondholders and other investors, including account holders with deposits of more than \u20ac100,000\u00a0euros \u2014 instead of classic bailouts that would\u00a0raid directly or indirectly the taxpayers of\u00a0other countries.<\/p>\n<p>It might even make bank creditors realize that investing in a bank is not a risk-free venture.<\/p>\n<p>&#8230;click on the above link to read the rest of the article&#8230;<\/p>\n<\/div>\n","protected":false},"excerpt":{"rendered":"<p>Who Gets to Pay for the Italian Banking Crisis? The missing Capital Buffer. Six years after Europe\u2019s sovereign debt crisis began, the Eurozone\u2019s third largest economy, Italy, has finally decided to do what just about every other country has done when facing a full-blown, almost out-of-control banking crisis: to set up a bad bank to [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[2],"tags":[2014,63,95,12023,5660,285,1464,4255],"class_list":["post-17030","post","type-post","status-publish","format-standard","hentry","category-economics","tag-banking-crisis","tag-banks","tag-brussels","tag-capital-buffer","tag-don-quijones","tag-eurozone","tag-italy","tag-wolfstreet"],"_links":{"self":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/17030","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=17030"}],"version-history":[{"count":2,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/17030\/revisions"}],"predecessor-version":[{"id":17032,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/17030\/revisions\/17032"}],"wp:attachment":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=17030"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=17030"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=17030"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}