Italian elections

81 posts in this topic

1 hour ago, jeba said:

Probably not too much, but I guess they´ll consider the impact policies may have on their own economy. And if I was Italian I´d be scared of state bankruptcy - which would prevent me from voting for politicians who publicly speak of not paying back debt.

 

German voters do not seem to have considered that German economic policy:

1. denies them public and private investment precisely at the time when that is most cost effective (schwarze Null),

2. risks blowing apart the Eurozone due to fiscal imbalances, which will be very costly for German residents as a whole.

 

Italians on the other hand, particularly southern Italians, have suffered from a monetary policy that makes their debt an eternal treadmill and requires "reforms" that often take food out of their own mouths without producing an adequate compensatory effect.  Under those conditions, it becomes at least rational to consider politicians who threaten the Eurozone with default.

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Varoufakis may not have made a good minister or negotiator, but he was right on the merits and here we are:

 

https://www.project-syndicate.org/commentary/merkel-responsible-for-italian-political-debacle-by-yanis-varoufakis-2018-05

 

Quote

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That is precisely what is happening now. Having vetoed much-needed EU reforms, Merkel’s successive governments guaranteed Europe’s fragmentation. Germany’s establishment media are now referring to the Italian economist whose appointment as finance minister was vetoed by the president as “Italy’s Varoufakis.” That moniker obscures a fundamental difference: I wanted to keep Greece in the eurozone sustainably and was clashing with Germany’s leaders in favor of the debt restructuring that would make this possible. By crushing our Europeanist government in the summer of 2015, Germany sowed the seeds of today’s bitter harvest: a majority in Italy’s parliament that dreams of exiting the euro.1

The causal link between Germany’s two political headaches has an economic basis. Trump understands one thing well: Germany and the eurozone are at his mercy, owing to their increasing dependence on large net exports to the US and the rest of the world. And this dependence has grown inexorably as a result of the austerity policies that were first tried out in Greece and then implemented in Italy and elsewhere.

To see the link, recall the “fiscal compact” to eliminate structural budget deficits that Germany insisted upon as a condition of agreeing to bailout loans for distressed governments and banks. Then note that this pan-European austerity drive took place against the backdrop of massive excess savings over investment. Finally, note that large excess savings and balanced government budgets necessarily mean large trade surpluses – and thus the increasing reliance of Germany, and Europe, on massive net exports to the United States and Asia. In other words, the same incompetent policies that gave rise to the xenophobic, anti-Europeanist Italian government also bolstered Trump’s power over Merkel.

 

The ridiculous German dream of Europe as export paradise has led to Europe as a whole being vulnerable to sophomoric chessboard politics led by external actors, as well as a constant risk of crisis.  Remember: the crisis doesn't have to happen for it to be a problem, as long as the crisis is a threat it is a problem in advance

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28 minutes ago, RenegadeFurther said:

The EU commission has completely lost the plot.

 

https://www.thelocal.it/20180529/markets-will-teach-italy-to-vote-for-the-right-thing-gunther-oettinger-italy

 

The markets will TEACH Italians to vote for the right thing

 

 

That was a misquote of German commissioner Oettinger by a journalist. The journalist apologised for it but that seems to be ignored. https://www.n-tv.de/politik/Oettinger-Zitat-bringt-Italiener-in-Rage-article20455025.html

But even if he had said it I don´t see whatwould be wrong with it. It seems clear to me that the election of a government which says they want Italy to leave the Eurozone and debt forgiveness to the tune of 250 billion in order to finance early retirement and basic income for everyone would scare away investors and ruin the economy. What´s wrong with pointing out that risk?

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1 minute ago, RenegadeFurther said:

 

No party campaigned to leave the Eurozone. 

 

 

I don´t know as I don´t speak Italian. I was under the impression from what I read that at least leading politicians of the winning parties did. And that they suggest to pay a basic income and reduce retirement age while asking for debt forgiveness. Doesn´t look very sustainable to me.

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8 minutes ago, jeba said:

That was a misquote of German commissioner Oettinger by a journalist. The journalist apologised for it but that seems to be ignored. https://www.n-tv.de/politik/Oettinger-Zitat-bringt-Italiener-in-Rage-article20455025.html

But even if he had said it I don´t see whatwould be wrong with it. It seems clear to me that the election of a government which says they want Italy to leave the Eurozone and debt forgiveness to the tune of 250 billion in order to finance early retirement and basic income for everyone would scare away investors and ruin the economy. What´s wrong with pointing out that risk?

 

Why did he apologize?

 

http://www.dw.com/en/eu-chides-budget-commissioner-g%C3%BCnther-oettinger-over-italy-remarks/a-43982166

 

In the wake of the uproar, Oettinger apologized, saying: "I fully respect the will of voters being left, right or center and in every country. By referring to the actual market developments in Italy, I did not mean to be disrespectful."

 

Also no party campaigned to leave the Eurozone.

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3 minutes ago, RenegadeFurther said:

Why did he apologize?

He didn´t. That´s just what journalisted twisted his words into. He merely said: "I fully respect the will of voters being left, right or center and in every country. By referring to the actual market developments in Italy, I did not mean to be disrespectful."

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4 minutes ago, RenegadeFurther said:

 

Sounds like an apology.

To me it sounds like a comment on a misinterpretation. "I apologise for ..." would have sounded like an apology to me.

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12 minutes ago, jeba said:

To me it sounds like a comment on a misinterpretation. "I apologise for ..." would have sounded like an apology to me.

Ah the typical jeba reply. 

 

I have no clue what I am talking about so I will revert to trolling this thread.

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Chief economist at UBS Global wealth management

 

Everyone needs to take a deep breath and calm down. Only then can we talk about Italy.

 


1) Bond market moves do not break up monetary unions. Bank runs do. There is no evidence of bank runs.

2) Neither Italian parties nor Italian voters support leaving the Euro.

3) The anti-party coalition was not expected to last, because of policy disagreements. It is not certain that the two anti-parties would try to form a government after elections.

 

Markets have moved anyway. We are now in that phase where any trader who overheard a conversation in their local Domino’s Pizza takeaway considers themselves an expert on Italian politics. Investors would be wise to treat recent market moves with caution.

 

Sound Advice

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48 minutes ago, RenegadeFurther said:

I have no clue what I am talking about so I will revert to trolling this thread.

I know you don´t. But please stop trolling my thread.

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i preface saying that i never believed berlusconi could get elected when he got into politics (like many others), so, i guess you can never say i'm 100% sure.


but no one i know in italy thinks at the moment there is the risk of Italexit

(or whatever. is there a name for it already?)

It's true that leaving europe was not part of the electoral campaign. 
it's also true that if you follow the politics of these parties, you know they are not very happy with the euro situation.
but i don't think they will propose the exit, i don't think they would have done it (even if there was no intermission from mattarella) and i don't think italians would vote for it (the majority)
I also would like to remember that the league (lega nord, the north league) started in the 90's as a party asking for north secessionism, send back south italians to their homes, death to rome etc
and they kept talking strongly about secessionism for a decade or more (they also had elections for padania independence)
they seems very comfortable in rome at the moment, so there is also that.
there is a lot that it's impossible for me to condensate now, but between all the things that worries me about the results of this las italian election (and it's a long list), there is not the fear of italy leaving europe.
 

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35 minutes ago, corrado said:

but i don't think they will propose the exit, i don't think they would have done it (even if there was no intermission from mattarella) and i don't think italians would vote for it (the majority)

Are you talking about the exit from the Euro or from the EU?

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 frankly most of the discussions in italian that i read, pro or against, puts the two things togheter.
 

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It's not deliberate Italexit or whatever that's the real risk. It's the risk of accidents and misjudgements at the Eurozone level, and the risk of a repeat of the 2008 crisis.  Greece was small beans but is the ECB ready to perform the basic function of a central bank which is to defend the credibility of the currency?  In Greece, the ECB chose a political intervention.  Choosing a political intervention in Italy, rather than supply the liquidity necessary to keep the system running, is much more consequential...

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When Merkel opened the EU borders for anyone she essentially ended the EU at the same time.

 

The Migrant crisis plays just as important a role as the Euro in the Italian elections.

 

The League which is growing in popularity has based its popularity on it decision to deport 1000`s of migrants.

 

Brexit, Hungary, Italy, Poland, Germany are all a direct result of Merkels horrific migrant policy.

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4 hours ago, RenegadeFurther said:

When Merkel opened the EU borders for anyone she essentially ended the EU at the same time.

 

The Migrant crisis plays just as important a role as the Euro in the Italian elections.


simply, no. 
i have to repeat that the migrant crisis (the one you talk about, merkel opening the borders) did not play the role you think in the italian elections.
we had it way before, maybe it even got better for Italy in the eyes of many people (you know, at least they were going *elsewhere*), less pression on us this time.
if anything, italy going toward populism is a result (between many other things) of angela merkel NOT helping us with migrants, way before she had her own crisis.

i was talking with two friends (that still live in italy) about this theory, one - that regulary works with refugees and migrants since 2012, simply answered AHAHAHHAHAHA. the other one said "tell them we've been picking people from the sea before it was cool"

then if you prefer, you can go on with your version, i will not bother another time, two is the charm.


 

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6 hours ago, RenegadeFurther said:

 

to be clear, i'm not even defending merkel. if you want to pin these election on her it's very easy, these parties have been riding discontent for the imposed economic measures for a loooong time. and the people voting them think that if we get out of europe and austerity, all will be fine and dandy again.

so you have a lot of things you could work with, i don't know why you stick with the irrelevant ones.

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