26th Mar – Italian minister proves key weakness in Eurozone’s systemic risk

By Bob Lyddon, 26th March 2020

Excerpt: ‘In a statement, reported by Reuters on 24th March, the Italian Economy Minister Roberto Gualtieri, called for the Eurozone’s bailout fund, the European Stability Mechanism (“ESM”), to be used to help economies hit by the coronavirus crisis, with no strings attached.

This demonstrates the key systemic flaw in the Eurozone financial system: there is no Eurozone sovereign borrower behind it. Each member state borrows on its own and it is no longer a genuine sovereign because it has given up powers, not all of which have then been taken up by a Eurozone institution.’

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Read Bob Lyddon’s recent co-authored publication with Politeia here: ‘Managing Euro Risk: Saving Investors from Systemic Risk’