For nearly ten years now, the key decision centers inside eurozone are trying to hide the huge problems, pretending that the crisis is behind, in order to maintain a completely failed economic model, which also reveals, day by day, its authoritarian nature and despise against real Democracy. The totally problematic structure of eurozone makes things even worse.
In Italy, we had another political crisis and a constitutional coup because the new majority and potential coalition government is not likeable to the Brussels/Berlin axis.
In Greece, things are not looking better. The country is about to exit the IMF-type neoliberal program imposed by the Troika (ECB, European Commission, IMF), in August. Yet, the economy is still in very bad shape, drowning in stagnation, with unprecedented unemployment, nearly zero growth and a national debt at 180% of GDP, which is actually much higher than Greece’s debt in 2010 (120% of GDP) when crisis hit the country!
In fact, the eurozone institutions and most of the European officials pretend that things are getting better for Greece, stating that the country has made progress, and one of the main reasons is because, apparently, they want to hide their big failure. It seems that no one really knows what will happen after Greece’s exit from the program because it is very doubtful that the so-called ‘markets’ will start lending the country with a sensible interest rate. Our guess is that the European mechanisms will silently continue lending money to the country, under heavy surveillance (like the rest of the eurozone periphery), selling to the media the common fairy tale of ‘recovery’.
It’s a similar situation that happens right now concerning the Italian banking system and the mega banking monster called Deutsche Bank, as they are being kept on life support. A practice which, however, will not be able to hold the system forever.
Indeed, latest signs from the systemically significant German monster reveal an ugly picture (one more time), which could create another financial earthquake that could hit the eurozone foundations to the point of no-return.
As Sharmini Peries of the Real News reports, the financial press has nervously been reporting a looming crisis at Deutsche Bank, and of late another troubling sign has surfaced when the CEO of the bank announced that it will attempt to recover its profits by laying off over 9000 workers and closing about 10 percent of its branches, and cutting most of its investment banking activity.
According to Paul Steinhardt, director of Makroskop, the Institute for the Study of Macroeconomic Policy, the problem is that Deutsche Bank is overexposed to the investment banking sector, legacy assets, and obviously these assets still lose money. What one can say, is that Deutsche Bank has huge problems. If we have more problems in Europe, we might well have more problems pretty soon depending on what happens in Italy. Then, actually, you will see even more problems with Deutsche Bank.
This is a picture of multiple systemic threats coming from different sides. Since the system is so unstable and interconnected, especially regarding different factors inside eurozone, these threats may soon come to the point of increasingly effecting each other, creating accelerating instability and, quite soon, an out-of-control situation.
Yet, even these strong vibrations are not enough to alarm the deaf ears of the eurocrats. They insist on their failed model with an almost religious faith. And some of them, not only do nothing to change it, but they behave as if they want to dynamite the foundations of their beloved union.