Italian referendum

cogito

HAMISH_MCTAVISH wrote: »

No surprise that the euro and markets have brushed this off as a non issue.

Nothing to panic about as the referendum outome was to keep the current constitutional arrangements.

The government has fallen so clearly nothing to panic about.

movilogo

This is not a referendum about the EU.

Yes but....

Italian PM said he would resign, which means election and Five Star party (having lead in polls) is likely to win. If they indeed win, they will ensure they could pull away from Euro anytime - which is a blow to Euro and EU.

So, it is a big blow to EU in general.

PS: But don't worry - Italians might find 3 judges to declare "this is just advisory" - so nothing would change

Thrugelmir

movilogo wrote: »

Yes but....

Italian PM said he would resign, which means election and Five Star party (having lead in polls) is likely to win. If they indeed win, they will ensure they could pull away from Euro anytime - which is a blow to Euro and EU.

So, it is a big blow to EU in general.

PS: But don't worry - Italians might find 3 judges to declare "this is just advisory" - so nothing would change

A major blow to EU stability.

Originally Posted by HAMISH_MCTAVISH
No surprise that the euro and markets have brushed this off as a non issue.

The markets had already priced in a NO vote.

Alan_Brown

I read that new EU rules now prevent state funded bank bailouts in the Eurozone. Unless the talk of a banking collapse is scaremongering, and if the EU stands firm on the bailout rules, then I don't see what else Italy could do other than to leave the Euro and go back to the Lira.

The EU is beginning to unravel, which is one of the reasons I voted to Brexit. I just hope we can get out and isolate ourselves from as much as the collateral damage as possible. Thank Christ we didn;t join the Euro. The Euroskeptics saved us then, and by insisting on an EU referendum they may have saved us again!

mwpt

Alan_Brown wrote: »

I read that new EU rules now prevent state funded bank bailouts in the Eurozone. Unless the talk of a banking collapse is scaremongering, and if the EU stands firm on the bailout rules, then I don't see what else Italy could do other than to leave the Euro and go back to the Lira.

The EU is beginning to unravel, which is one of the reasons I voted to Brexit. I just hope we can get out and isolate ourselves from as much as the collateral damage as possible. Thank Christ we didn;t join the Euro. The Euroskeptics saved us then, and by insisting on an EU referendum they may have saved us again!

In your opinion, what would have happened to the UK if we had joined the Euro? I'm wondering if you could draw parallels to other countries in the Euro zone.

Alan_Brown

mwpt wrote: »

In your opinion, what would have happened to the UK if we had joined the Euro? I'm wondering if you could draw parallels to other countries in the Euro zone.

This, probably:

https://www.theguardian.com/business/economics-blog/2013/jun/02/britain-euro-what-if-joined

Also

http://www.economicshelp.org/blog/6182/economics/if-the-uk-had-been-in-the-euro/

mwpt

Alan_Brown wrote: »

This, probably:

https://www.theguardian.com/business/economics-blog/2013/jun/02/britain-euro-what-if-joined

Ha ha!

Quote from the article:

As in Spain and Ireland, a spectacular bubble developed in the housing market, fuelled by excessively low lending rates, an "anything goes" mentality among lenders and lax regulation. Even outside the euro, the UK had quite a boom going in the housing market in the mid-2000s. Inside, it would have been like the wild west.

and this

Severe conditions were attached to the loan, the biggest the IMF had ever organised, including deep cuts in welfare and pensions and wage reductions across the public sector.

I mean, did we actually join the Euro and I just missed it? Because it sounds like we did if those are the scenarios the guardian was painting as the outcomes.

But ok, which country do you personally draw parallels to? Would we have been more like Greece or more like Germany?

Filo25

Alan_Brown wrote: »

I read that new EU rules now prevent state funded bank bailouts in the Eurozone. Unless the talk of a banking collapse is scaremongering, and if the EU stands firm on the bailout rules, then I don't see what else Italy could do other than to leave the Euro and go back to the Lira.

The EU is beginning to unravel, which is one of the reasons I voted to Brexit. I just hope we can get out and isolate ourselves from as much as the collateral damage as possible. Thank Christ we didn;t join the Euro. The Euroskeptics saved us then, and by insisting on an EU referendum they may have saved us again!

It was hardly just Eurosceptics who were opposed to Euro membership.

Even I was opposed to Euro membership, and I'm hardly a John Redwood disciple !

I have a lot of sympathy for anyone in the Club Med states who wants out of the Eurozone, I'm just not sure on a practical level how easy that would be to do in a relatively painless manner.

I also don't really see how Brexit would save us from the fallout of a potential EU collapse, assuming that we will carry on trading with the EU as before as most of those supporting Brexit claim, then we are still very exposed to a genuine EU economic crisis, but that's just the interconnected nature of the globalised economy in which we live.

Alan_Brown

Filo25 wrote: »

I also don't really see how Brexit would save us from the fallout of a potential EU collapse, assuming that we will carry on trading with the EU as before as most of those supporting Brexit claim, then we are still very exposed to a genuine EU economic crisis, but that's just the interconnected nature of the globalised economy in which we live.

We'll still be impacted, but with our own free trade deals in place with countries extant to the EU we will have a more balanced economy. Currently, if you look at the UK trading figures you can see a drop off in EU trade from the GCC in 2008 and a corresponding rise in trade with the rest of the world. This will increase even more once we escape the EU's clutches.

cogito

Alan_Brown wrote: »

We'll still be impacted, but with our own free trade deals in place with countries extant to the EU we will have a more balanced economy. Currently, if you look at the UK trading figures you can see a drop off in EU trade from the GCC in 2008 and a corresponding rise in trade with the rest of the world. This will increase even more once we escape the EU's clutches.

It's also worth pointing out that the EU's share of world trade has fallen from 30% to 16.5% since 1980. It would have fallen anyway because of emerging market economies but even so it's hardly a ringing endorsement.